By US stocks saw a decline on Monday as investors continued to unload key tech shares that have been driving the bull market.
The S&P 500 fell by 0.2%, while the Nasdaq Composite dropped 0.8%.
The Dow Jones Industrial Average stood out as the relative outperformer, climbing 225 points, or 0.5%, as investors shifted towards non-tech stocks like Caterpillar, JPMorgan, and UnitedHealth. Despite this, all three major indexes have been down for the past two weeks, with tech stocks largely responsible for the losses.
Palantir and Nvidia, two tech giants that have been favorites among retail investors, each saw significant drops — Palantir lost more than 3%, while Nvidia dropped 2%, continuing the downward trend from last week.
Over the past week, Nvidia saw a nearly 6% decline, and Palantir suffered an 11% loss. Other popular tech stocks, including Tesla and Micron, also saw declines.
“US stock indices sold off on Friday after the release of much better-than-expected labor market data. Non-farm payrolls jumped to 256,000, way above the 164,000 anticipated. In addition, the Unemployment Rate dropped to 4.1% from 4.2%,” David Morrison, senior market analyst at Trade Nation said.
The US dollar soared, as did bond yields, while stock index futures plunged, rounding off a poor week for US equities.
Surging bond yields contributed most to the fall of stocks in the US. The 10-year Treasury yield on Monday hit its highest level since November 2023.
Better-than-anticipated US economic data on Friday cast doubt on further rate cuts by the Federal Reserve, which boosted yields further.
““With the 10-year yield potentially getting to 5%, I think it’s going to be very hard for the equity market to gain any meaningful traction here until there’s — at a minimum — stability in interest rates,” Adam Turnquist, chief technical strategist at LPL Financial told CNBC.
“We don’t think there’s a risk for the market going over to bear market territory, but certainly think a correction could be in the cards on a short-term basis,” Turnquist added.
Meanwhile, the market is pinning its hopes on the new fourth-quarter earnings. Investors expect the earnings of several banks and major companies to lift the mood in the stock market.
US Steel stock rises
Shares of US Steel rose on Monday after CNBC reported that Cleveland Cliffs and Nucor were partnering to acquire the company.
Cleveland Cliffs would buy all of US Steel in cash then sell the Big River Steel subsidiary to Nucor, according to the CNBC report.
The offer would be in the high $30s per share, CNBC reported.
At the time of writing, shares of US Steel were up 8.3%.
Moderna share sinks 21%
Shares of biotech giant Moderna tanked on Monday after the company cut its 2025 sales forecast.
The company said it expects revenue in 2025 to come in the range between $1.5 billion and $2.5 billion.
Most of the revenue for the company would come in the second half of the year. Moderna had previously expected full-year guidance of $2.5 billion to $3.5 billion.
Monday’s decline put the stock on track for its worst day on record. Shares were down more than 21.5% at the time of filing the report.
Tech stocks under pressure
Shares of major tech companies in the US were under pressure, which was weighing on benchmark equity indices.
Shares of NVIDIA and Palantir fell more than 3% each on Monday.
Additionally, Tesla and Meta Platforms fell 1% and 2%, respectively at the time of writing.
Monday’s declines add to last week’s sharp losses in tech stocks as well. NVIDIA had fallen nearly 6% last week, while Palantir had slumped close to 16%.
Shares of Tesla had also dipped nearly 4% last week.
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