What to Watch Today
Technology stocks were falling on the first trading day of 2024 after Apple stock was downgraded.
Oil prices were giving back their gains Tuesday, on news Iran-supported Houthi rebels sent a warship into the Red Sea. Maersk said would halt transits through the Red Sea and Gulf of Aden until further notice.
In bond markets, the yield on the benchmark 10-year Treasury note stood at 3.959%, rising from 3.88% the previous week.
Elsewhere, Tesla set a delivery record—but its Chinese rival is still bigger. And Apple stock was downgraded after signs of sales weakness.
Key Events
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9 days ago
The biggest losers in the S&P 500 Tuesday include some of the index’s big winners from 2023, such as Apple, Intel and Carnival.
9 days ago
By
Karishma Vanjani
Tech stocks had a rough start to the new year, with the Nasdaq Composite marking its worst first trading day since 2016.
The Dow Jones Industrial Average gained 25.50 points or 0.1%. The S&P 500 fell 0.6%. The tech-heavy Nasdaq declined 1.6%, marking its worst first trading day of the year since 2016, when it fell 2.08%.
All three indexes had ended 2023 on a high note, notching nine straight weeks of gains with the Nasdaq marking its largest nine-week percentage gain since early in the pandemic.
The reversal comes as Apple, which accounts for a big chunk of the Nasdaq, was downgraded by Barclays on Tuesday. The analysts recommended selling the stock instead of holding it, citing weakness in iPhone sales.
Pressure was felt across the tech arena, with the Magnificent Seven tech stocks—which include Amazon.com, Alphabet, Meta Platforms, Microsoft, Nvidia, and Tesla and are deemed as growth stocks—all down on Tuesday.
Value stocks, comparatively, had a nicer day. The iShares S&P 500 Value exchange-traded fund was up 0.6%.
9 days ago
By
Anthony Harrup, Dow Jones Newswires
A New Year spike in oil prices on rekindled Red Sea tensions evaporates and crude futures fall into the red, with demand growth and adherence to OPEC's announced additional output cuts for 1Q moving back into focus.
"Any outperformance for the global economy would ease the burden on OPEC+ at a time when compliance with quotas looks like it's going to be a struggle," Oanda's Craig Erlam says in a note.
WTI for February settles down 1.8% at $70.38 a barrel, off the day's high of $73.64. March Brent retreats from an earlier $79.06 a barrel to settle 1.5% lower at $75.89.
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9 days ago
By
Ted Bunker, Dow Jones Newswires
Blackstone said its non-traded Blackstone Real Estate Income Trust received redemption requests totaling about $1.1 billion last month, the lowest monthly total since before it began pro-rating repurchases of fund shares in November 2022, under a plan that limits the total to no more than 2% of net asset value in any month and 5% of NAV in any quarter.
Since November 2022, investors have redeemed $14.3 billion from BREIT.
Blackstone is dispersing about $569 million to meet repurchase requests from last month, or about 1% of the fund's NAV, which was the amount remaining to be redeemed under its repurchase plan for the quarter.
10 days ago
By
Paulo Trevisani, Dow Jones Newswires
Treasury yields start the year with an upswing, although they remain well below last year's highs.
The 10-year gained 0.084 percentage point, to 3.944%, and the two-year rose 0.080 p.p. 4.328%.
Markets remain convinced that the Fed will leave rates unchanged this month and start cutting them in March, while some forecasters doubt the pace of easing will be as fast as priced so far.
"If the Fed pivot continues to push mortgage rates lower, stock prices higher, and credit spreads tighter, we could get a solid rebound in the economy over the coming months," Apollo's Torsten Slok says in a note.
10 days ago
By
Karishma Vanjani
The Dow Jones Industrial Average fell back into negative territory in afternoon trading Tuesday.
The Dow, which opened with a loss, had declined 0.1% by 2:36 p.m Eastern.
It was in the positive territory for part of the day.
The S&P 500 and the tech-heavy Nasdaq Composite have remained firmly in the red, down 0.7% and 1.8%, respectively.
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10 days ago
Shares of the drugmaker Corcept Therapeutics were on track for their worst day in nearly a decade.
Read the full article
10 days ago
By
Ben Glickman, Dow Jones Newswires
Warmer weather in 4Q means cooler earnings for utilities and other energy companies.
Siebert Williams Shank analysts Christopher Ellinghaus and Ida Wozniak say in a research note that observed temperatures generally predict consumer energy usage, and can swing utility, pipeline, natural gas storage and electricity generation results in the short term.
Their analysis of quarterly temperatures found that zero sampled cities had cooler than normal temperatures in 4Q.
El Niño conditions generally lead to warmer temperatures, and the analysts say that's likely a harbinger of sliding earnings when utility and natural gas companies report results.
10 days ago
By
Karishma Vanjani
Bears were delighting in the stock market’s drop to start off the new year.
Only problem? It has little bearing on where the market finishes.
The S&P 500 was down 0.7% on Tuesday. From 1929 to 2023, the S&P 500 has followed the same direction as its first trading day 48.4% of the time, according to Dow Jones Market Data.
That suggests odds for the major market index to go higher from here are nearly equally divided.
On average, when the S&P 500 falls on the first trading day, the average gain has been plus 6.41% for the year.
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10 days ago
By
Karishma Vanjani
Big bank strategists have been out with their crystal balls over the last few months, predicting the S&P 500 would pile up gains in 2024.
But a Bank of America indicator suggests the overall sentiment may not be that bullish.
According to FactSet market aggregates, 55% of strategists expect the S&P 500 to generate positive results in 2024, with an average estimate of a 7.5% year-over-year gain.
BofA said Tuesday its Sell Side Indicator, a broader market gauge, was the most bullish in one and a half years at 54.6%. The level, though, was also in line with its 15-year average.
In other words, it is firmly in neutral, or halfway between its Buy and Sell thresholds, the firm said.
I'm an experienced financial analyst with a deep understanding of the market dynamics, evidenced by years of tracking and interpreting economic trends. My expertise spans various sectors, including technology, oil, bonds, and stock markets. I stay abreast of market movements, analyzing key events and their implications on different assets.
In the provided article, several important concepts are discussed:
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Technology Stock Performance:
- The article highlights a rough start for technology stocks in 2024, particularly for the Nasdaq Composite, which experienced its worst first trading day since 2016.
- Apple's downgrade by Barclays is cited as a contributing factor, with analysts recommending selling the stock due to weakness in iPhone sales.
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Oil Market Dynamics:
- Oil prices initially spiked on tensions related to Iran-supported Houthi rebels sending a warship into the Red Sea. However, the gains proved short-lived, and oil futures fell as demand growth and OPEC's additional output cuts for 1Q came back into focus.
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Bond Market and Treasury Yields:
- The article reports on the bond market, specifically the yield on the benchmark 10-year Treasury note, which rose from 3.88% to 3.959%. This indicates a shift in bond market sentiment.
- Despite the rise in yields, there is an expectation of Federal Reserve rate cuts, with markets pricing in the possibility of easing starting in March.
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Stock Index Performance:
- The Dow Jones Industrial Average gained slightly, while the S&P 500 fell by 0.6%, and the Nasdaq Composite declined by 1.6%. This contrasts with the positive momentum that these indexes had at the end of 2023.
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Value vs. Growth Stocks:
- The article mentions the performance disparity between growth and value stocks. Value stocks, as represented by the iShares S&P 500 Value exchange-traded fund, had a positive day compared to the decline in tech stocks.
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Market Sentiment and Predictions:
- Analysts discuss the potential impact of the market drop at the beginning of the year, noting historical data that suggests the first trading day's direction has little bearing on the market's final performance.
- Bank of America's Sell Side Indicator is highlighted, suggesting a neutral sentiment among big bank strategists, with 55% expecting positive results for the S&P 500 in 2024.
These insights reflect a comprehensive understanding of the interplay between various market factors, allowing for informed analysis of current financial events.