S&P, Nasdaq start 2024 in subdued fashion as Apple weighs
By David French
(Reuters) -The S&P 500 and Nasdaq Composite ended the first trading session of 2024 lower, weighed by Apple shares (NASDAQ:AAPL) falling after a broker downgrade and declines among other big-tech names triggered by a move higher by Treasury yields.
The lackluster session follows a year where Wall Street's three major indexes notched double-digit gains on the back of optimism around artificial intelligence and stabilizing inflation. The S&P 500 ended last week within 1% of a record closing high reached in early 2022.
However, equities were pressured on Tuesday as U.S. Treasury yields climbed, with the yield on 10-year notes ticking above 4.000% to a two-week high before easing slightly.
Such movement in Treasury yields reflected investors' tempered expectations around cuts this year in U.S. interest rates. This, in turn, weighed on growth stocks — among them tech stocks — which would benefit from a more favorable rate environment.
Apple fell after Barclays downgraded the tech giant to «underweight», citing weakening iPhone demand. Other megacap stocks, including Nvidia (NASDAQ:NVDA), Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT), also declined.
«Everyone was very excited by the tail-end rally, the Fed — on the surface at least — paring back a little, and the fact we didn't have a recession,» said Jason Pride, chief of investment strategy & research at Glenmede.
«But does that mean we're out the woods yet? I suspect, even if the Fed brings rates down gradually, monetary policy is still tight and still likely to be a hindrance to overall economic activity.»
The Fed's December policy meeting minutes and a slew of labor market data are on the roster for this week as market participants look to
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