Equities ended mostly weaker Tuesday as initial enthusiasm about the tentative debt ceiling deal gave way to uncertainty over its final approval in Congress. The Dow industrials eased 0.2 percent, the S&P 500 was flat but held above support at 4200, and the Nasdaq was up 0.3 percent. US Treasury yields, oil prices, and the dollar all declined.

The major indexes advanced at the open amid relief that President Biden and House Majority Leader Kevin McCarthy announced a debt ceiling extension deal over the weekend, but the indexes fell back amid uncertainty over final approval, and the prospect of delays that will push action up to the June 5 deadline. More hawkish comments from Richmond Fed President Thomas Barkin was weighed on equities too.

US Treasury yields declined on hopes for a debt pact, which in. turn helped megacaps outperform to boost the Nasdaq. Among sectors, best performers included communications services, information technology, consumer discretionary, and real estate. Lagging were materials, industrials, energy, and consumer staples.

Among shares in focus, Nvidia continued its recent run after positive comments from its CEO about new products and partnerships. Analyst upgrades lifted Ford and Boston Beer, and Tesla advanced after CEO Elon Musk met with Chinese leaders. On the downside, Comerica sold off on news of data privacy trouble.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.