Dow heads for first close above 49,000 as investors shrug at Venezuela situation, buy chip stocks

The Dow Jones Industrial Average rose to new heights on Tuesday, a day after the index scored fresh highs, as investors moved past the U.S. attack on Venezuela.

The blue-chip Dow traded higher by 444 points, or 0.9%. The S&P 500 gained 0.5%, while the Nasdaq Composite was up 0.4%.

“Magnificent Seven” member Amazon lifted the three major averages, rising more than 3%. Other stocks related to artificial intelligence also supported the broader market, including Micron Technology and Palantir Technologies. Micron advanced more than 6%, while Palantir climbed about 3%.

It’s only the third trading day of the new year, and semiconductor stocks have already been on a tear, with Micron being one of the leaders. With Tuesday’s gains, the stock has risen about 17% year to date. That’s coming off of a blockbuster year for the name, as it soared more than 240% in 2025.

“Tech kind of took a pause at the back end of the year, but I don’t think anyone questions that AI is a game changing technology,” said Ross Mayfield, investment strategist at Baird. “We’re seeing the chip stocks lead. That’s probably to be expected, but that cyclical rotation is still continuing.”

“You can have the AI trade and tech stocks work and the other cyclical components of the market work as well,” he continued. “That’s the kind of thing you might expect in an economy that is going to be running hot in 2026 with rate cuts, tons of fiscal stimulus and an AI enthusiasm that’s getting closer and closer to a fever pitch.”