Stock Market Today: Dow Jumps As Trump Touts This Deal; Robinhood Plunges But Palantir Pops (Live Coverage)

NEW YORK – The Dow Jones Industrial Average surged higher Tuesday, leading a broad market rally as investors reacted to a significant development surrounding former President Donald Trump's media company. The move provided a powerful, if narrow, catalyst that lifted sentiment, even as the technology sector witnessed a stark divergence with major gains for Palantir and a dramatic plunge for Robinhood.

The session underscored a market increasingly sensitive to bespoke catalysts, from political announcements to major contract wins and regulatory threats. While the blue-chip Dow enjoyed a strong advance, the day's biggest stories were found in individual stocks, painting a complex picture of risk and opportunity for investors.

Here’s a breakdown of today’s key market action.

Market Rallies on Deal Optimism

The three major U.S. indexes closed firmly in positive territory, shaking off recent sluggishness. The Dow led the gains, adding over 350 points as cyclical and industrial names benefited from the positive sentiment.

The S&P 500 and the tech-heavy Nasdaq Composite also posted solid advances, though their performance was more mixed under the surface, reflecting the day's sharp divergence in the technology space.

• By the Numbers: The Dow Jones Industrial Average (^DJI) climbed 378 points, or 1.0%, to close near 39,280. The S&P 500 (^GSPC) rose 0.8%, while the Nasdaq Composite (^IXIC) gained 0.7%.
• Driving the News: The primary driver for the broad-based optimism was news related to Trump Media & Technology Group (TMTG), which created a ripple effect across politically-sensitive stocks and injected a dose of speculative fervor into the market.

Trump Media Deal Ignites Market

The day's biggest headline came from former President Trump, who announced via his Truth Social platform that TMTG, its parent company, had secured final merger approval with the special purpose acquisition company (SPAC) Digital World Acquisition Corp. (DWAC).

The announcement, which signals the final step before TMTG becomes a publicly traded entity, sent shares of DWAC soaring and sparked a rally in a basket of stocks associated with the former president.

• The Catalyst: In a post on Truth Social, Trump hailed the deal as a move to "stand up to the tyranny of Big Tech," confirming that the long-delayed merger was proceeding. This immediately triggered a massive influx of buying activity in DWAC shares.
• The Impact: Shares of Digital World Acquisition Corp. (DWAC) skyrocketed, closing the session up more than 45%. The trading volume was immense, exceeding 20 times its daily average as both retail and institutional investors piled in.
• Broader Context: SPACs, or "blank-check companies," are shell corporations that raise capital through an IPO to acquire a private company and take it public. The DWAC-TMTG merger has faced numerous regulatory hurdles and delays, making today's news a significant milestone for the company and its supporters.

Tech Sector Sees Major Divergence

Away from the political headlines, the technology sector told two very different stories. The stark contrast between the fortunes of Palantir and Robinhood highlights a market that is meticulously scrutinizing individual company fundamentals and risks.

Palantir Pops on Major Contract Win

Data analytics firm Palantir (PLTR) was one of the day's top performers after announcing a substantial new contract with the U.S. Department of Defense.

The company confirmed it was awarded a multi-year, $480 million contract to provide its Maven Smart System prototype, an AI-powered platform designed to assist with battlefield targeting and intelligence. The news reaffirmed the company's deep ties to the U.S. government and its leadership position in the defense-tech space.

• Why It Matters: This contract win is a significant validation of Palantir's AI technology and its strategic importance to national security. For investors, it provides a tangible source of long-term, recurring revenue, differentiating Palantir from more speculative software companies. Shares of PLTR jumped over 16% on the news.

Robinhood Plunges Amid Regulatory Fears

In a sharp reversal of fortune, shares of retail trading platform Robinhood (HOOD) plummeted following reports that the Securities and Exchange Commission (SEC) is preparing to unveil a new set of rules that could severely impact its business model.

Sources indicate the SEC is in the final stages of a proposal that would target "payment for order flow" (PFOF), a practice where brokerage firms are compensated for directing customer orders to specific market makers.

• The Concern: Payment for order flow is the primary revenue engine for zero-commission brokers like Robinhood. Any significant restrictions or an outright ban on the practice could fundamentally damage the company's profitability and force a complete overhaul of its business model.
• The Bottom Line: Regulatory risk has long been the biggest overhang for Robinhood's stock. Today's reports, though unconfirmed, brought that risk to the forefront, causing a crisis of confidence among investors. Shares of HOOD cratered, falling by more than 18% to a multi-month low.

In Other Market News

Beyond the day's main headlines, several other notable movers captured investor attention.

• Tesla's Trajectory: Shares of the electric vehicle giant (TSLA) moved higher, gaining nearly 3% in today's session. The move was attributed to general market strength and a positive analyst note from Morgan Stanley, which reiterated its "Overweight" rating and cited the company's potential in AI and robotics beyond its core auto business.
• Sector Rotation: Energy and industrial stocks performed well, benefiting from the risk-on sentiment. Financials were more mixed, with traditional banks rising while fintech companies like Robinhood faced pressure.

What to Watch Next

Today's session provides a clear roadmap for what investors should monitor in the coming days and weeks. The market is being pulled by several powerful, and at times conflicting, forces.

• Political Volatility: The TMTG deal demonstrates that political headlines remain a potent, if unpredictable, market catalyst. The public debut of TMTG will be a closely watched event, likely to drive volatility in a specific corner of the market.
• Regulatory Headwinds: The focus on Robinhood and PFOF is a stark reminder of the regulatory pressures facing the fintech industry. Investors will be keenly awaiting any formal announcement from the SEC, which could have wide-ranging implications for the entire brokerage sector.
• Tech's Two-Track Market: The split between Palantir's fundamental success and Robinhood's regulatory woes highlights the end of an era where all tech stocks rise together. The market is now rewarding companies with clear revenue streams and defensible business models while punishing those with significant external risks.