IWDA ETF Surges on Strong US Tech Rally—Should European Investors Buy the Momentum?

Investors pressed pause on recent gains Thursday, as a tech-led selloff pulled major U.S. equity indexes lower. Higher Treasury yields and renewed caution ahead of key inflation data unsettled sentiment, snapping a three-day winning streak for the S&P 500. ## Market Overview The **S&P 500** slipped, closing at **5,188.42**, down **0.8%** on the day. The **Nasdaq Composite** underperformed, dropping **1.3%** to **16,234.19**, weighed by weakness in large-cap technology shares. The **Dow Jones Industrial Average** held up better but still finished down **0.5%** at **39,052.18**. In fixed income, the **10-year U.S. Treasury yield** rose to **4.33%**, its highest level in nearly a month, as investors braced for Friday’s PCE inflation report—closely watched by the Fed for policy direction. The move higher in yields pressured growth stocks, particularly in the tech sector. The **U.S. dollar** firmed, with the **DXY** index rising to **104.7**, its strongest level in two weeks. The **EUR/USD** pair slipped below **1.08** as traders digested hawkish comments from several Fed officials and a mixed set of eurozone economic data. Commodities were mixed. **Oil prices** steadied, with Brent crude holding near **$84 per barrel** amid ongoing geopolitical tensions in the Middle East and mixed signals on global demand. **Gold** eased to **$2,180 per ounce** as the stronger dollar and higher yields weighed on the precious metal. ## Key Movers Tech stocks led the declines. **Nvidia (NVDA)** retreated **3.1%**, while **Apple (AAPL)** shed **2.2%** after reports of slowing iPhone sales in China. **Meta Platforms (META)** and **Amazon (AMZN)** also fell more than **1%** each, as investors rotated out of recent high-flyers. The semiconductors sector lagged, with the **PHLX Semiconductor Index** down **2.4%**. Investors took profits in chipmakers after a multi-month rally, as concerns grew that valuations had outpaced near-term earnings expectations. Defensive sectors like utilities and consumer staples outperformed. **Procter & Gamble (PG)** edged up **0.4%**, and **Duke Energy (DUK)** rose **0.6%** as investors sought shelter from volatility. ETF flows reflected the cautious mood. According to preliminary data, broad-market ETFs such as the **SPDR S&P 500 ETF Trust (SPY)** and **Invesco QQQ Trust (QQQ)** saw modest outflows, while inflows picked up in short-term Treasury ETFs and defensive sector funds. For European investors navigating turbulent markets, resources like the Ultimate Guide to ETF Investing for European Beginners in 2026 provide timely perspective on portfolio construction and risk management. Elsewhere, small-cap stocks continued to lag their large-cap peers. The **Russell 2000** dipped **1.1%**, extending its relative underperformance for the quarter. For those exploring diversification, our analysis on why European investors shouldn’t ignore small-cap ETFs in 2026 outlines key considerations amid shifting market leadership. ## What to Watch All eyes turn to Friday’s release of the **February PCE inflation report**—the Federal Reserve’s preferred measure of price pressures. A hotter-than-expected print could reinforce bets that the Fed will keep rates higher for longer, potentially fueling further volatility across risk assets. Investors will also monitor fresh commentary from Fed officials, with several scheduled to speak in the coming days. The tone of their remarks will be closely parsed for clues on the timing of potential rate cuts. In Europe, preliminary March inflation figures are due out next week, likely to set the tone for ECB policymakers ahead of their April meeting. Earnings season is winding down, but a few notable corporates—particularly in the tech and consumer sectors—are set to report results. As volatility picks up, portfolio resilience and disciplined investing become increasingly important. For actionable strategies on navigating uncertain markets, see our breakdown of lump sum versus dollar-cost averaging for EU investors and tips for building a monthly investing habit that sticks. We’ll be back tomorrow with analysis of the PCE inflation data and what it means for markets moving forward.