US STOCKS-Wall Street slides from recent highs as megacaps weigh
By Noel Randewich and Shristi Achar A
Dec 4 (Reuters) – U.S. stocks dipped from recent highs on Monday, with investors turning cautious ahead of employment data due this week that could alter expectations that the Federal Reserve will cut interest rates early next year.
All three major indexes receded, with megacaps Microsoft MSFT.O, Apple AAPL.O, Nvidia NVDA.O and Amazon AMZN.O dropping between 1% and 3%, pressured by higher U.S. Treasury yields, which made returns on stocks less attractive.
The S&P 500 .SPXregistered its highest close of the year on Friday as remarks from Fed Chair Jerome Powell acknowledged the central bank’s need to “move forward carefully” amid signs of economic softening, comments that bolstered expectations the Fed has finished raising rates.
Small-cap stocks rose on Monday, with the Russell 2000 .RUT up 0.65%, bringing its gain this year to over 6%, far less than the S&P 500’s 19% recovery over the same period.
“There is a lot of chop around here that is not necessarily meaningful,” said Tom Martin, a senior portfolio manager at GLOBALT Investments in Atlanta.
“We have a really important Fed meeting coming up, and what makes it important is that all of a sudden, the market has decided that they’re going to cut early next year.”
Ride-hailing service Uber Technologies UBER.N rallied 3.4% after an announcement on Friday it will join the S&P 500 effective Dec. 18.
Shares of Alaska Air GroupALK.N tumbled 15% after the carrier said on Sunday it would acquire peer Hawaiian Holdings HA.O for $1.9 billion, including debt. Hawaiian’s shares nearly tripled in value, helping lift the Russel index.
Traders widely expect the central bank will keep rates unchanged at its meeting next week. Interest rate futures suggest a 58% probability the Fed will start cutting rates by March 2024, according to the CME Group’s FedWatch tool.
However, some analysts warn that markets have been too quick to price in lower interest rates.
Of the 11 S&P 500 sector indexes, seven declined, led lower by communication services .SPLRCL, down 1.7%, followed by a 1.55% loss in information technology .SPLRCT.
The S&P 500 was down 0.70% at 4,562.68 points.
The Nasdaq declined 1.09% to 14,149.33 points, while the Dow Jones Industrial Average was down 0.20% at 36,172.89 points.
Adding to declines on Monday were renewed fears about a widening of the war between Israel and Gaza after an attack on three commercial vessels in the southern Red Sea.
Shares of cryptocurrency firms such as Coinbase Global COIN.O, Riot Platforms RIOT.O and Marathon Digital MARA.O rallied over 7% as bitcoin crossed $40,000 for the first time this year.
Declining stocks outnumbered rising ones within the S&P 500 .AD.SPX by a 1.2-to-one ratio.
The S&P 500 posted 38 new highs and no new lows; the Nasdaq recorded 107 new highs and 53 new lows.
S&P 500 trades https://tmsnrt.rs/3t1xDsM
(Reporting by Amruta Khandekar and Shristi Achar A in Bangalore, and by Noel Randewich in Oakland, Calif.; Editing by Anil D’Silva, Pooja Desai and Aurora Ellis)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Original: MSFT Feed: US STOCKS-Wall Street slides from recent highs as megacaps weigh