We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Wall Street closed mixed on Tuesday, dragged down by tech and consumer discretionary stocks. The yield on the U.S. 10-year Treasury Note climbed to a two-week high. Two of the three major stock indexes ended in the red, while one ended in the green.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 25.5 points, or 0.1%, to close at 37,715.54. Eighteen components of the 30-stock index ended in positive territory, while 12 ended in positive.
The tech-heavy Nasdaq Composite dropped 245.41 points, or 1.6%, to close at 14,765.94.
The S&P 500 slid 27 points, or 0.6%, to close at 4,742.83. Five of the 11 broad sectors of the benchmark index closed in the red. The Technology Select Sector SPDR (XLK), the Industrials Select Sector SPDR (XLI) and the Consumer Discretionary Select Sector SPDR (XLY) declined 2.6%, 1% and 0.9%, respectively, while the Health Care Select Sector SPDR (XLV) advanced 1.8%.
The fear-gauge CBOE Volatility Index (VIX) decreased 6% to 13.20. A total of 11.9 billion shares were traded on Tuesday, lower than the last 20-session average of 12.4 billion.
Shares of Apple Inc. (AAPL - Free Report) declined 3.6% after Barclays downgraded the tech behemoth’s rating to “underweight”. The analysts cited weakening demand for the company’s flagship mobile iPhone 15 and almost zero upgrades to the iPhone 16 model as the main reason. Demand has been a major concern for the company since early 2023, and its holiday season sales forecast has also been below Wall Street estimates. Apple has also struggled in China’s market since the resurgence of Huawei. Being one of the “Magnificent Seven” stocks, Apple’s plight weighed down on the tech sector and the broader market in general.
On Tuesday, the U.S. benchmark 10-year treasury yield climbed above the 4% mark to touch a 2-week high before settling at 3.937%. When treasury yields go up, future valuations of mega-cap growth stocks like tech seem unreasonable, and it weighs on the sector.
Economic Data
The U.S. Census Bureau reported that construction spending for November had increased 0.4% as opposed to a consensus of 0.6% for the period. The increase for October was revised up to 1.2% from the previously reported 0.6%.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Stock Market News for Jan 3, 2024
Wall Street closed mixed on Tuesday, dragged down by tech and consumer discretionary stocks. The yield on the U.S. 10-year Treasury Note climbed to a two-week high. Two of the three major stock indexes ended in the red, while one ended in the green.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 25.5 points, or 0.1%, to close at 37,715.54. Eighteen components of the 30-stock index ended in positive territory, while 12 ended in positive.
The tech-heavy Nasdaq Composite dropped 245.41 points, or 1.6%, to close at 14,765.94.
The S&P 500 slid 27 points, or 0.6%, to close at 4,742.83. Five of the 11 broad sectors of the benchmark index closed in the red. The Technology Select Sector SPDR (XLK), the Industrials Select Sector SPDR (XLI) and the Consumer Discretionary Select Sector SPDR (XLY) declined 2.6%, 1% and 0.9%, respectively, while the Health Care Select Sector SPDR (XLV) advanced 1.8%.
The fear-gauge CBOE Volatility Index (VIX) decreased 6% to 13.20. A total of 11.9 billion shares were traded on Tuesday, lower than the last 20-session average of 12.4 billion.
Apple (AAPL - Free Report) Weighs Down on the Tech Sector
Shares of Apple Inc. (AAPL - Free Report) declined 3.6% after Barclays downgraded the tech behemoth’s rating to “underweight”. The analysts cited weakening demand for the company’s flagship mobile iPhone 15 and almost zero upgrades to the iPhone 16 model as the main reason. Demand has been a major concern for the company since early 2023, and its holiday season sales forecast has also been below Wall Street estimates. Apple has also struggled in China’s market since the resurgence of Huawei. Being one of the “Magnificent Seven” stocks, Apple’s plight weighed down on the tech sector and the broader market in general.
Consequently, shares of Microsoft Corporation (MSFT - Free Report) and Advanced Micro Devices, Inc. (AMD - Free Report) fell 1.4% and 6%, respectively. Microsoft carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
10-Year Treasury Yield Touches 2-Week High
On Tuesday, the U.S. benchmark 10-year treasury yield climbed above the 4% mark to touch a 2-week high before settling at 3.937%. When treasury yields go up, future valuations of mega-cap growth stocks like tech seem unreasonable, and it weighs on the sector.
Economic Data
The U.S. Census Bureau reported that construction spending for November had increased 0.4% as opposed to a consensus of 0.6% for the period. The increase for October was revised up to 1.2% from the previously reported 0.6%.