Tech Slump Drags US Stocks Lower as Bond Yields Rise and Investors Eye Key Economic Data
Staff Editor US Stocks Decline as Tech Sector Leads Downturn
US stocks closed lower on Monday, with the technology sector spearheading a broad market decline. Major indexes fell approximately 1% as investors grappled with rising bond yields and anticipated key economic data releases in the shortened trading week ahead.
The S&P 500 dropped 1.07% to 5,906.94, while the Dow Jones Industrial Average shed 418.48 points, or 0.97%, closing at 42,573.73. The tech-heavy Nasdaq Composite experienced the steepest decline, falling 1.19% to 19,486.79.
This downturn continues a recent trend, with the Nasdaq 100 having declined nearly 5% since mid-December, and the S&P 500 dropping about 3% in the same period. The 10-year Treasury yield, which has been a focal point for investors, decreased by eight basis points to 4.546% on Monday but remains significantly higher than earlier in the month.
Market analysts are closely monitoring upcoming economic indicators. Tom Lee of Fundstrat emphasized the importance of the ISM manufacturing data for signals of business expansion. Meanwhile, Katie Stockton from Fairlead Strategies noted technical “sell” signals in the stock market, indicating potential correction risks.
In individual stock news, Boeing shares fell up to 6% following reports of a plane crash in South Korea.
The market faces additional factors, including a four-year high in housing supply reported by Redfin, and a surge in natural gas futures due to cold weather forecasts. Investors are also preparing for a US stock market closure on January 9 in honor of former President Jimmy Carter.
In commodities, West Texas Intermediate crude oil rose 0.72% to $71.11 a barrel, while Brent crude increased 0.38% to $74.07 a barrel. Gold saw a slight decrease of 0.37% to $2,622.20 an ounce. In the cryptocurrency market, Bitcoin showed resilience, increasing by 0.73% to $94,252.
As the week progresses, market participants will be keenly watching the S&P Case-Shiller home price index, initial jobless claims, and ISM manufacturing data for further indications of economic health and potential market direction.
