NEW YORK — More drops for Big Tech stocks dragged on Wall Street Tuesday, overshadowing gains for much of the U.S. stock market.

The S&P 500 slipped 0.5%, even though two out of every three stocks within the index rose. The Dow Jones Industrial Average rose 203 points, or 0.5%, and the Nasdaq composite sank 1.3%.

PayPal rose 8.6% and helped lead the market’s gainers after it topped analysts’ expectations for profit during the spring. It also raised its forecast for profit over the full year.

JetBlue Airways climbed 12.3% after reporting a profit for the spring, when analysts were expecting to see a loss. The airline also outlined ways it hopes to improve on-time performance and attract customers.

But a 0.9% slide for Microsoft nevertheless helped drag the S&P 500 lower as investors waited for its latest profit report, which arrived after trading finished for the day. Microsoft’s stock fell further in after-hours trading.

Most of the other stocks in the group that’s come to be known as the “Magnificent Seven” also fell Tuesday, including a 7% tumble for Nvidia. This handful of Big Tech stocks drove the S&P 500 to dozens of records this year, in part on investors’ frenzy around artificial intelligence technology. But they ran out of momentum this month amid criticism they had grown too expensive and expectations had run too high.

Last week, investors found profit reports from Tesla and Alphabet underwhelming, which raised concerns that other “Magnificent Seven” stocks could also fail to impress. Amazon, Apple and Meta Platforms will report their latest profit results in coming days. Their performance carries extra weight on the S&P 500 because they’re among the largest by value.

Helpfully for the market, other stocks have been rising up to cushion some of Big Tech’s recent softness, including smaller stocks and companies whose profits are closely tied to the strength of the economy. They rallied on hopes that inflation is slowing enough to get the Federal Reserve to soon begin cutting interest rates.

The Russell 2000 index of smaller stocks added 0.3% Tuesday to stretch its market-leading gain for the month to 9.5%.

Many along Wall Street expect this rotation from Big Tech to smaller stocks to continue, but more cautious voices are still urging skepticism.

“In our view, the recent rally is likely unsustainable as the fundamental support is lacking,” according to Austin Pickle, investment strategy analyst at Wells Fargo Investment Institute, who pointed to how more than 40% of small-cap companies aren’t making any profits, among other challenges.

Also helping to weigh on Wall Street Tuesday was Merck, which fell 9.8% despite reporting stronger results for the last quarter than expected. It gave a forecast for profit this year that fell short of analysts’ expectations, partly because of costs related to its buyout of Eyebiotech.