The US stock market ended lower on Monday, December 30, 2024, with the technology sector driving the downturn as the year comes to a close. This decline comes amid rising bond yields and investors closely monitoring crucial economic data during the shortened trading week.
Table Content:
Market Overview and Key Indexes
While stocks briefly dipped nearly 2% at their lowest point, some late-day buying pressure mitigated the losses, resulting in a roughly 1% decline for the major indexes. The Nasdaq 100 has experienced a nearly 5% drop since mid-December, coinciding with a significant surge in bond yields. The S&P 500 also retreated about 3% during the same period.
At the closing bell, the major indexes stood as follows:
- S&P 500: 5,906.94, down 1.07%
- Dow Jones Industrial Average: 42,573.73, down 0.97% (-418.48 points)
- Nasdaq Composite: 19,486.79, down 1.19%
Bond Yields and Economic Data
Although the 10-year Treasury yield decreased by eight basis points to 4.546% on Monday, it remains significantly higher than its level earlier in the month, when it hovered around 4.1%. This rise in bond yields has contributed to the recent market decline.
This week, investors are focused on key economic indicators, including the S&P Case-Shiller home price index released on Tuesday, initial jobless claims on Thursday, and the ISM manufacturing data on Friday. Fundstrat’s Tom Lee highlighted the importance of the ISM data, stating that a move above 50 in 2025 would signal business expansion and potentially improved earnings growth.
Technical Analysis and Market Outlook
Katie Stockton, founder of Fairlead Strategies, observed that the recent market weakness has triggered a technical “sell” signal based on weekly stochastic and MACD indicators. This signal raises the likelihood of a stock market correction in January.
Adding to the market pressure, Boeing shares fell as much as 6% following the tragic crash of a Boeing 737-800 in South Korea on Sunday.
Conclusion
The US stock market closed lower on Monday, led by declines in the tech sector, as rising bond yields and upcoming economic data weigh on investor sentiment. Technical indicators suggest a potential market correction in January. With the New Year’s Day holiday closure on Wednesday, trading activity will resume on Thursday. Investors will continue to monitor economic data and market trends for further insights into the market’s direction in the new year.
