US stocks fell as losses in Apple Inc. and Tesla Inc. weighed on the S&P 500 and the tech-heavy Nasdaq 100. Treasuries gained, poised for their best start to a year in more than two decades.
(Bloomberg) — US stocks fell as losses in Apple Inc. and Tesla Inc. weighed on the S&P 500 and the tech-heavy Nasdaq 100. Treasuries gained, poised for their best start to a year in more than two decades.
The S&P 500 and the Nasdaq 100 dropped, after opening the first trading session of the new year with gains. Tesla dropped after fourth-quarter deliveries missed estimates. Apple fell as investors assessed news that it asked suppliers for fewer airpod and watch components.
Treasury yields declined across the curve, with the policy-sensitive 10-year yield around 3.74%. Oil declined under pressure from a strong dollar.
Investors, still reeling from a spell of wonky predictions, are expecting a volatile year of trading. Federal Reserve policy will dictate how stocks and bonds perform, with some traders already seeking out opportunities resulting from risk assets getting sold off.
Recession concerns also continue to linger as investors ponder whether Fed tightening will push the US economy to a hard or soft landing. All eyes will be on the jobs report this week, as softening in the labor market remains the Fed’s focus.
“As for the equity bear market, I don’t know exactly how it progresses from here as the consensus seems to be down for the first half and a rally in the second half but the consensus is usually wrong,” said Peter Boockvar, chief investment officer at Bleakley Financial Group. “All I’m confident about is it ain’t over.”
Signs that Covid infections may have peaked in some of China’s biggest cities buoyed sentiment earlier and spurred a rally in US-listed Chinese firms. However, China’s economy may not get the “outsized boost” people are expecting, Matt Maley, chief market strategist at Miller Tabak + Co., wrote in a note. Chris Senyek of Wolfe Research also isn’t bullish about China’s reopening.
“In our view, there’s still a massive amount of uncertainty there, and whenever growth does begin to reaccelerate, inflation headwinds are more likely than not to offset global growth tailwinds,” he said in a note.
Read More: China Vows to Hit Back at Nations Imposing Covid Travel Curbs
The main markets moves are:
Stocks
- The S&P 500 fell 0.3% as of 10:14 a.m. New York time
- The Nasdaq 100 fell 0.6%
- The Dow Jones Industrial Average fell 0.2%
- The Stoxx Europe 600 rose 1.3%
- The MSCI World index rose 0.2%
Currencies
- The Bloomberg Dollar Spot Index rose 0.5%
- The euro fell 0.9% to $1.0570
- The British pound fell 0.2% to $1.2021
- The Japanese yen rose 0.1% to 130.62 per dollar
Cryptocurrencies
- Bitcoin fell 0.6% to $16,654.88
- Ether fell 0.8% to $1,209.4
Bonds
- The yield on 10-year Treasuries declined 13 basis points to 3.74%
- Germany’s 10-year yield declined seven basis points to 2.37%
- Britain’s 10-year yield declined six basis points to 3.61%
Commodities
- West Texas Intermediate crude fell 0.9% to $79.55 a barrel
- Gold futures rose 1.3% to $1,849.50 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Namitha Jagadeesh.
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