Stocks Slide on Weakness in Megacap Tech Stocks

The S&P 500 Index ($SPX) (SPY) today is down -0.15%, the Dow Jones Industrials Index ($DOWI) (DIA) is down -0.18%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -0.19%.  March E-mini S&P futures (ESH26) are down -0.17%, and March E-mini Nasdaq futures (NQH26) are down -0.22%.

Stock indexes are under pressure today, with the Dow Jones Industrials sliding to a 1-week low and the Nasdaq 100 falling to a 1.5-week low.  The weakness in the Magnificent Seven technology stocks is leading the broader market lower on the last trading day of the year.  Also, mining stocks are sliding today, with gold prices falling to a 2.5-week low and silver prices plunging more than -8%. In addition, higher bond yields are negative for stocks, with the 10-year T-note yield climbing by +3 bp to 4.15% after weekly jobless claims unexpectedly fell to a 1-month low, a hawkish factor for Fed policy.

Trading activity is subdued today, with volumes well below normal, as markets in Germany and Japan are closed for the New Year's holiday. 

US weekly initial unemployment claims unexpectedly fell -16,000 to a 1-month low of 199,000, showing a stronger labor market than expectations of an increase to 218,000.

Today's better-than-expected Chinese economic news is supportive of global growth prospects.  The China Dec manufacturing PMI rose +0.9 to 50.1, stronger than expectations of no change at 49.2 and the fastest pace of expansion in 9 months.  Also, the Dec non-manufacturing PMI rose +0.7 to 50.2, stronger than expectations of 49.6.

Seasonal factors are bullish for stocks.  According to data from Citadel Securities, since 1928, the S&P 500 has risen 75% of the time in the last two weeks of December, climbing 1.3% on average.

Market attention this holiday-shortened week will focus on US economic news.  On Friday, the Dec S&P manufacturing PMI is expected to remain unrevised at 51.8. 

The markets are discounting the odds at 15% for a -25 bp rate cut at the FOMC's next meeting on January 27-28.

Overseas stock markets are mixed today.  The Euro Stoxx 50 is down -0.08%.  China's Shanghai Composite closed up +0.09%.  Japan's Nikkei Stock 225 is closed for a bank holiday.

Interest Rates

March 10-year T-notes (ZNH6) today are down -6 ticks.  The 10-year T-note yield is up +2.6 bp to 4.147%.  Mar T-notes gave up an early advance today and turned lower after US weekly jobless claims unexpectedly fell to a 1-month low, a sign of labor market strength that is hawkish for Fed policy.  The weakness in stocks today is boosting some safe-haven demand for government debt and limiting losses in T-notes. 

European government bond yields are moving lower today.  The 10-year German bund yield is not trading today, with German markets closed for the New Year's holiday.  The 10-year UK gilt yield is down -1.9 bp to 4.479%.

Swaps are discounting a 1% chance of a +25 bp rate hike by the ECB at its next policy meeting on February 5.

US Stock Movers

The Magnificent Seven stocks are moving lower today, pressuring the broader market.  Meta Platforms (META) is down -0.64%, Microsoft (MSFT) is down -0.31%, Amazon.com (AMZN) is down -0.29%, Apple (AAPL) is down -0.24%, Alphabet (GOOGL) is down -0.20%, and Tesla (TSLA) is down -0.04%.  Bucking the trend, Nvidia (NVDA) is up +0.35% to lead gainers in the Nasdaq 100 after Reuters reported that the company approached TSMC to ramp up production of its H200 artificial intelligence chips due to signs of stronger demand from China.

Mining companies are sliding today, with gold prices falling to a 2.5-week low and silver prices plunging more than -8%.  Newmont (NEM), Hecla Mining (HL), and Coeur Mining (CDE) are down more than -1%.  Also, Freeport-McMoRan (FCX) is down -0.66%.

Corcept Therapeutics (CORT) is down more than -46% after the FDA rejected the company's relacorliant drug as a treatment for patients with hypertension secondary to hypercortisolism, saying it could not arrive at a favorable benefit-risk assessment without additional effectiveness evidence.

GlobalFoundries (GFS) is down more than -2% after Wedbush downgraded the stock to neutral from outperform. 

Vanda Pharmaceuticals (VNDA) is up more than +24% after the FDA approved the company's Nereus drug for the prevention of vomiting induced by motion. 

Terawulf Inc (WULF) is up more than +5% after Keefe, Bruyette & Woods upgraded the stock to outperform from market perform with a price target of $24. 

Nike (NKE) is up more than +2% to lead gainers in the Dow Jones Industrials on signs of insider buying after an SEC filing showed CEO Hill purchased about $1 million worth of shares on Monday.

Earnings Reports(12/31/2025)

CoastalSouth Bancshares Inc (COSO), Golden Matrix Group Inc (GMGI), Immersion Corp (IMMR).