Equities were mostly better Tuesday with the market extending Monday's rebound move from oversold territory last week. The Dow Jones industrial average eased 0.2 percent, the S&P 500 gained 0.5 percent and the Nasdaq rose 0.8 percent. Bond yields fell, the dollar was mixed but mostly lower, while oil prices dropped.

Amazon and Tesla were among the best performers as investors rotated back into megacaps and big technology/AI plays. Strong results from Oracle lifted software stocks. Other winners included food, utilities and building products. On the downside, financials saw a risk-off move after JP Morgan warned that market expectations are too high and bank earnings will take a hit from lower interest rates. Energy had a bad day as oil prices dropped to two-year lows after a warning from OPEC+ of weakening demand. Other weak sectors included transports, autos, travel & leisure, chemicals and industrial metals.

An unexpectedly weak reading on business sentiment from the National Federation of Independent Business kept the soft economy theme in play, as did news of much weaker than expected Chinese imports. Some forecasters said the NFIB report points to much weaker growth in nonfarm payrolls headed into year end, while the Chinese import data point to much weaker global demand. A very well-received U.S. Treasury 3-year note sale sent bond yields down with 2-year and 3-year yields down 8 basis points on the day.

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.