The Dow Jones Industrial Average set another closing record on Tuesday at 36,799.65 points after upbeat economic data powered the index forward as investors bet on a strong recovery. Tech stocks faltered to drag the Nasdaq down 1.4% in its biggest decline since December, and the S&P 500 was mostly unchanged.

Investors mulled a trove of new prints out of Washington, including a fresh read on the ISM Manufacturing Index and the Labor Department's latest job openings.

Releases from ISM showed manufacturing slowed in December on a cool down in demand for goods, but that supply chain constraints are starting to ease. On the employment side, data showed demand for workers was historically high again in November, with a record 4.5 million Americans quitting their jobs as labor shortages continue to strain employers, though the impact of the latest virus wave has yet to show.

"Looking ahead, the Omicron variant wave will likely lead to some short-term weakness in the labor market," Sam Bullard, senior economist for Wells Fargo, wrote in a note published earlier this week. "However, we believe this will be temporary and that the pace of hiring should pick back up by the spring."

Despite a mixed day, markets have made headway overall, picking up right where they left off in a banner 2021 to trade near all time highs into the new year. The pace of that momentum, however, remains at the helm of the Federal Reserve as it gears up for potential rate hikes as soon as this quarter to deal with rising inflation.

Market veteran Jim Bianco of his eponymous firm Bianco Research told Yahoo Finance’s Brian Sozzi in a sit-down interview that the central bank’s measures pose the biggest threat to the red-hot rally in equities.

"I think that is the number one risk right now in 2022," he said, adding that high inflation is likely to be persistent and can push the Fed hard to do something. “In the process of doing something about it, it puts the rally of the stock market at risk."

Managing Partner Ted Oakley told Yahoo Finance Live that the Federal Reserve “turned political on us.”

“As soon as the inflation numbers had gone up, I think the administration had pressed them not to worry as much about the market,” he said.

Automakers led headlines on Tuesday, with shares of Ford Motor Company (F) surging more than 11% in afternoon trading at its highest level in two decades to close at $24.31 after the company said it would nearly double annual production capacity for its popular F-150 Lightning electric pickup to 150,000 vehicles.

The move comes as Ford's competition with rival General Motors (GM) in the electric vehicle race heats up, with GM set to unveil its own electric truck on Wednesday. GM closed up at a record high of 7.47% to $65.74.

Meanwhile, General Motors was ousted by Japanese carmaker Toyota Motor Corp (T) as the leader in U.S. sales for the first time in nearly a century. Toyota sold 2.332 million vehicles in the United States in 2021, beating 2.218 million for General Motors, the companies reported on Tuesday. GM's U.S. sales slumped 13% for 2021, while Toyota was up 10%.

Shares of Toyota closed 6.92% higher on Tuesday at $199.19 a piece.

4:01 p.m. ET: Dow powers on to set second-straight closing record

Here's how market closed out Tuesday's session:

• S&P 500 (^GSPC): -3.03 (-0.06%) to 4,793.53

• Dow (^DJI): +214.39 (+0.59%) to 36,799.45

• Nasdaq (^IXIC): -210.08 (-1.33%) to 15,622.72

• Crude (CL=F): +$0.95 (+1.25%) to $77.03 a barrel

• Gold (GC=F): +$14.70 (+0.82%) to $1,814.80 per ounce

• 10-year Treasury (^TNX): +4 bps to yield 1.6680%

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1:46 p.m ET: Nasdaq tumbles, S&P wavers as Dow sustains rally

Here were the main moves in markets as of 1:46 p.m. ET:

• S&P 500 (^GSPC): -14.21 (-0.30%) to 4,782.35

• Dow (^DJI): +196.99 (+0.54%) to 36,782.05

• Nasdaq (^IXIC): -280.25 (-1.77%) to 15,552.54

• Crude (CL=F): +$1.02 (+1.34%) to $77.10 a barrel

• Gold (GC=F): +$14.30 (+0.79%) to $1,814.40 per ounce

• 10-year Treasury (^TNX): +4.6 bps to yield 1.6740%

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12:45 p.m. ET: ARKK's losses pour into new year

Ark Innovation’s (ARKK) top holdings plummeted in midday trading, positioning the popular fund for a rough start to the new year.

Among the most heavily-allocated picks in her portfolio posting declines during the session were Tesla (TSLA), down 3.29% to $1,160.25; Teladoc Health (TDOC), which shed 6.08% to $89.30, and Zoom Communications (ZM), tumbling 5.69% to 173.77.

ARKK was down 5.64 in the early afternoon, slumping lower from a challenging 2021 that saw declines for the exchange-traded fund of more than 20%.

Wood recently promised her strategy could deliver a 40% compound annual rate of return during the next five years — a projection she later tweaked to a lower, however still-lofty 30%-40% after criticism of her statement.

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11:20 a.m. ET: Apple turns red after reaching $3 trillion milestone

Shares of Apple (AAPL) dipped more than 1% during midday trading after the iPhone-maker rallied in Monday's session toward a $3 trillion market capitalization.

The decline contributed to losses in the Nasdaq as the index pared Monday's gains to edge 1.8% lower, shedding 280 points.

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11:07 a.m. ET: Toyota dethrones GM as No. 1 automaker

Japanese carmaker Toyota Motor Corp (T) topped General Motors Co (GM) in U.S. sales last year, unseating the Detroit-based vehicle company as the country's leader in auto sales for the first time in nearly a century.

Toyota sold 2.332 million vehicles in the United States in 2021, beating 2.218 million for General Motors, the companies reported on Tuesday. GM's U.S. sales slumped 13% for 2021, while Toyota was up 10%. In 2020, GM's U.S. sales totaled 2.55 million, compared with Toyota's 2.11 million and Ford's 2.04 million.

Shares of GM were up more than 5% in morning trading to $64.25 a piece. Toyota was up nearly the same amount, trading 4.92% higher at $195.45.

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10:21 a.m. ET: Manufacturing slips amid lower demand for goods

The Institute for Supply Management (ISM) reported its latest index of national factory activity fell in to 58.7 last month, signaling a cooling demand for goods.

December's print came in below consensus estimates of 60.2 and lower than the previous month's read of 61.1, according to Bloomberg Data. Readings above 50 indicate an expansion in manufacturing

Meanwhile, data showed that supply chain constraints are starting to ease. The ISM survey's measure of supplier deliveries declined to 64.9 from 72.2 in November, with prints above 50% suggesting slower deliveries to factories.

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10:05 a.m. ET: Job openings hold near a record high

Demand for workers remained historically high in November, pointing to continued labor shortages that have strained employers.

The Department of Labor reported 10.562 million job openings in November in a fresh read out Tuesday on its Labor Turnover Summary (JOLTS). The figure came in below October's print of 11.033, based on the government's first estimate for the month. Consensus economist estimates pointed to a 11.079 million in November, according to Bloomberg data.

The data does not yet meaningfully capture the impact of rising cases of COVID on employment in the latest wave of the virus. Some economists suggested labor shortages may be worsened in the near-term due to the latest surge.

"Looking ahead, the Omicron variant wave will likely lead to some short-term weakness in the labor market," Sam Bullard, senior economist for Wells Fargo, wrote in a note published earlier this week. "However, we believe this will be temporary and that the pace of hiring should pick back up by the spring."

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9:54 a.m. ET: Ford gets a move on EV truck production

Ford Motor Company (F) plans to nearly double annual production capacity for its popular F-150 Lightning electric pickup to 150,000 vehicles to keep up with a surge in demand ahead of its arrival at U.S. dealers this spring, the company said on Tuesday.

The model has attracted nearly 200,000 reservations already, far outpacing the automaker’s initial production capacity for 70,000-80,000 vehicles.

Ford's announcement comes as its electric truck vehicle race heats up with competitor General Motors Co (GM), which is scheduled to unveil the Chevrolet Silverado electric pickup on Wednesday set to go on sale in early 2023.

Shares of Ford climbed 6.64% at open to $23.22 a piece. Rival GM was also up 2.56% to $63.73 per share.

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9:30 a.m. ET: Markets charge forward into second straight day of gains

Here's what happened in the markets at the start of the day's trading session:

• S&P 500 (^GSPC): +15.07 (+0.31%) to 4,811.63

• Dow (^DJI): +182.71 (+0.50%) to 36,767.77

• Nasdaq (^IXIC): +4.23 (+0.03%) to 15,837.03

• Crude (CL=F): +$0.47 (+0.62%) to $76.55 a barrel

• Gold (GC=F): +$8.30 (+0.46%) to $1,808.40 per ounce

• 10-year Treasury (^TNX): +4.4 bps to yield 1.6720%

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7:33 a.m. ET: Stock futures point to continued gains

Here's how contracts on the major indexes fared before market open:

• S&P 500 futures (ES=F): +17.00 points (+0.36%), to 4,803.00

• Dow futures (YM=F): +120.00 points (+0.33%), to 36,575.00

• Nasdaq futures (NQ=F): +52.50 points (+0.32%) to 16,538.00

• Crude (CL=F): +$0.11 (+0.14%) to $76.19 a barrel

• Gold (GC=F): +1.10 (+0.06%) to $1,801.20 per ounce

• 10-year Treasury (^TNX): 1.628 bps to yield 0.00%

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6:02 p.m. Monday ET: Stock futures quietly open after record-setting session

Here were the main moves in markets heading into the overnight session:

• S&P 500 futures (ES=F): -0.50 points (-0.01%), to 4,785.50

• Dow futures (YM=F): -29.00 points (-0.08%), to 36,426.00

• Nasdaq futures (NQ=F): +16.25 points (+0.10%) to 16,501.75

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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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