Stocks Lose Steam After Rally as Bond Yields Climb: Markets Wrap

(Bloomberg) — Stocks struggled to gain traction in a quiet post-holiday session, with mixed jobless claims data doing little to alter bets on the Federal Reserve rate outlook.

Equities fell, halting a three-day winning streak for the S&P 500. That’s after its best Christmas Eve performance since 1974, according to data compiled by Bespoke Investment Group. Treasuries dropped ahead of a $44 billion seven-year note sale. Bitcoin sank even with MicroStrategy Inc. planing to issue more shares. Major European markets were closed.

Recurring applications for US unemployment benefits rose to the highest in more than three years, adding to signs that it is taking longer for out-of-work people to find a job. Initial claims, meanwhile, ticked down to 219,000 in the week ended Dec. 21.

“Employment claims has too much noise to spark a move,” said Andrew Brenner at NatAlliance Securities. “Direction for now in bonds is lower and steeper, but that could change on a dime. As for Fed outlook, they believe they have convinced the markets that the recalibration phase is over. And that the number of rate cuts next year will be minimal.”

The S&P 500 fell 0.3%. The Nasdaq 100 slid 0.3%. The Dow Jones Industrial Average slipped 0.3%.

The yield on 10-year Treasuries advanced four basis points to 4.63%. The Bloomberg Dollar Spot Index added 0.1%. Bitcoin fell 2.8% to $95,652.92.

Corporate Highlights:

• Alibaba Group Holding Ltd. agreed to merge its South Korean operations with E-Mart Inc.’s e-commerce platform to better compete in the country’s fast-paced online retail sector.
• Apple Inc.’s price target was raised to a Street-high of $325 from $300 at Wedbush, which said the company is “heading into a multi-year AI-driven iPhone upgrade cycle.”
• Progressive Corp. was upgraded to outperform from market perform at Raymond James, which wrote the company’s “long-term record of growth and value creation makes it a core holding for large cap growth investors.”

Key events this week:

• Japan Tokyo CPI, unemployment, industrial production, retail sales, Friday
• US goods trade, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 fell 0.3% as of 9:31 a.m. New York time
• The Nasdaq 100 fell 0.3%
• The Dow Jones Industrial Average fell 0.3%
• The MSCI World Index fell 0.2%

Currencies

• The Bloomberg Dollar Spot Index rose 0.1%
• The euro was little changed at $1.0398
• The British pound fell 0.4% to $1.2516
• The Japanese yen fell 0.3% to 157.86 per dollar

Cryptocurrencies

• Bitcoin fell 2.8% to $95,652.92
• Ether fell 3.2% to $3,354.78

Bonds

• The yield on 10-year Treasuries advanced four basis points to 4.63%
• Germany’s 10-year yield was unchanged at 2.32%
• Britain’s 10-year yield was unchanged at 4.58%

Commodities

• West Texas Intermediate crude rose 0.8% to $70.63 a barrel
• Spot gold rose 0.3% to $2,625.52 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Omar El Chmouri and Aya Wagatsuma.

©2024 Bloomberg L.P.