In a downbeat start to 2024, US stocks decline on Tuesday morning, signaling a reversal after a winning year that saw the S&P 500 narrowly miss setting a new record high. The benchmark S&P 500 (^GSPC) experienced a decline of nearly 0.6%, while the Dow Jones Industrial Average (^DJI) shed 0.3%, equating to a loss of about 100 points. The tech-oriented Nasdaq Composite (^IXIC) also faced a setback, losing approximately 0.9%.
The optimistic momentum in the stock market, which had persisted for two months, faltered on Friday, marking the conclusion of a robust year for major indices. Notably, the S&P 500 achieved its ninth consecutive weekly win, marking the longest winning streak since 2004. The index was on the cusp of surpassing its all-time closing high of 4,796.56.
Tech stocks, however, faced headwinds following a downgrade by Barclays analysts on Apple’s stock rating. The downgrade cited concerns about demand for new iPhones, causing Apple (AAPL) shares to drop by 1.7%. The broader tech sector also experienced a decline as a result.
The week’s economic updates are expected to test the resilience of the stock market rally, with particular focus on the December jobs report scheduled for Friday. Investors are closely monitoring the report for its potential impact on the Federal Reserve’s policy decisions. The prevailing sentiment among investors is a belief in swift and substantial interest-rate cuts in 2024, which has been a driving force behind the buoyancy in stock prices.
In other segments of the market, oil prices saw an uptick as tensions rose in response to Iran sending a warship to the Red Sea after the US Navy sank three Houthi boats over the weekend. Both West Texas Intermediate crude (CL=F) and Brent crude (BZ=F) futures climbed over 2% in the wake of escalating geopolitical tensions.
Meanwhile, the cryptocurrency market witnessed notable developments as bitcoin prices surged more than 3%, surpassing the $45,000 mark for the first time since early 2022. Optimism stemmed from growing expectations that the Securities and Exchange Commission (SEC) would soon approve a spot bitcoin exchange-traded fund (ETF). The positive momentum in the crypto market spilled over to related stocks, with Marathon Digital (MARA) shares surging almost 12% in premarket trading, recovering some recent losses.
In the opening day of 2024, the decline in US stocks signals a cautious start to the year, reflecting a shift in market dynamics following a robust performance in the previous year. Investors remain vigilant, navigating through economic indicators, geopolitical events, and developments in the tech and cryptocurrency sectors that could shape the trajectory of financial markets in the coming weeks.
Source: Yahoo Finance
