Market Overview
The stock market initially showed gains, but these quickly faded following economic releases at 10:00 ET. Treasury yields rose as stocks declined, influenced by a stronger-than-expected ISM Services PMI reading for December and the November JOLTS - Job Openings Report, which indicated a significant increase in job openings.
The ISM Services PMI also revealed a notable rise in the Prices Index, reaching 64.4% from 58.2%, surpassing the 60.0% level for the first time since January 2024. The 10-year yield increased to 4.68% from 4.63%, marking a seven basis point rise from the previous day.
Stock Performance
Major indices experienced muted losses until the S&P 500 fell below its 50-day moving average of 5,950, triggering additional selling. The S&P 500 closed 1.1% lower, while the Nasdaq Composite dropped 1.9%.
- Apple (AAPL, Financial) fell to 242.21, down 2.79 (-1.1%), following a downgrade to Sell from Neutral at MoffettNathanson.
- Tesla (TSLA, Financial) decreased to 394.36, down 16.69 (-4.1%), after being downgraded to Neutral from Buy at BofA Securities.
- NVIDIA (NVDA, Financial) dropped to 140.14, down 9.29 (-6.2%), despite initially rising 2.5% after Jensen Huang's keynote at the Consumer Electronics Show.
- Microsoft (MSFT, Financial) declined to 422.37, down 5.48 (-1.3%).
- Amazon.com (AMZN, Financial) fell to 222.11, down 5.50 (-2.4%).
The information technology sector declined by 2.4%, influenced by the losses in AAPL, NVDA, and MSFT. The consumer discretionary sector was down 2.2%, affected by TSLA and AMZN. However, energy (+1.1%) and health care (+0.6%) sectors closed higher.
Today's News
Nvidia (NVDA, Financial) made significant announcements at the Consumer Electronics Show, showcasing new AI technology that could extend its lead in the semiconductor industry. Despite this, Nvidia shares fell by 5.7% while competitors AMD (AMD) and Intel (INTC) saw contrasting movements, with AMD dropping 1.4% and Intel rising 0.8%. Analysts noted the company's strategic advancements in AI, which are expected to influence the tech landscape significantly.
President-elect Donald Trump declared potential tariffs on Denmark over Greenland, questioning Denmark's authority over the territory. This political tension affected Danish pharma companies trading in the U.S., with Novo Nordisk (NVO, Financial) closing down ~2%. This move highlights the geopolitical risks associated with international trade policies.
Palantir (PLTR, Financial) shares declined 5% following ARK Invest's sale of $15M in shares. The stock has faced multiple sell-offs from ARK ETFs in recent months, and Morgan Stanley recently initiated coverage with an Underweight rating. Despite a remarkable 2024 performance, Palantir's valuation remains under scrutiny.
XTI Aerospace (XTIA, Financial) announced a best-efforts offering of 363.64M shares, aiming to raise $20M. The offering, priced at $0.055 per share, led to a 28% drop in XTIA shares in after-hours trading. The proceeds are intended for general corporate purposes.
Kimbell Royalty Partners (KRP, Financial) saw a post-market decline of 6.6% after announcing a $231M acquisition of mineral and royalty interests. The deal, which includes an option to pay partially in units, is expected to be accretive to cash flow per unit over the next five years.
JPMorgan Chase (JPM) is reportedly planning to end its hybrid work model, requiring all employees to return to the office five days a week. This move signals a shift back to pre-pandemic work expectations and reflects CEO Jamie Dimon's views on office work.
Flutter Entertainment (FLUT) revised its 2024 U.S. revenue guidance downward by $370M, citing adverse sports results impacting its financials. The announcement led to a 2.02% drop in its shares after hours.
Bitcoin (BTC-USD) and Ether (ETH-USD) experienced significant declines, with Bitcoin falling below $100K following robust U.S. economic data that dampened hopes for Federal Reserve rate cuts. This downturn reflects the ongoing volatility in the cryptocurrency market.
GuruFocus Stock Analysis
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