Traders work on the floor of the New York Stock Exchange on the first day of trading of the new year on Jan. 2, 2025.
Spencer Platt | Getty Images
Stocks slid on Thursday in a choppy first trading session of the new year, as the slump to end 2024 extended into January.
The blue-chip Dow Jones Industrial Average traded down 151.95 points, or 0.36%, to close at 42,392.27. The S&P 500 fell 0.22%, finishing at 5,868.55. The Nasdaq Composite slipped 0.16% to 19,280.79. The S&P 500 and Nasdaq have now fallen for five straight sessions, their longest losing streaks since April.
The market averages initially rose on Thursday, with the Dow up more than 300 points at session highs, but the gains reversed in late-morning trading. The Dow’s intraday swing from high to low was more than 700 points.
Tech giant Apple weighed on the market, falling 2.6%. Tesla fell 6% after reporting that annual deliveries declined in 2024. Chipmaker Nvidia rose 3%, helping to somewhat offset the declines from other Big Tech stocks.
Thursday’s trading moves come after a solid 2024 for stocks ended on a sour note. The S&P 500 surged 23%, but ended the year with four straight down days for the first time since 1966.
“If you think about the market moving two steps forward, one step back, we’re in that one-step back phase after a stellar, really, 2024. … Valuations and sentiment have swung to the optimistic euphoric side, so we’re seeing the market work through those overbought conditions in the short term,” Edward Jones senior investment strategist Angelo Kourkafas told CNBC.
The losing streak means it will be difficult for a “Santa Claus rally” to materialize. That well-known market indicator is usually characterized by rising stocks in the five final days of a calendar year and the first two trading days of January. The broad index rises an average of 1.3% during this period and has finished higher almost 80% of the time, according to Dow Jones market data going back to 1950.
Bond yields were also volatile on Thursday, with the benchmark 10-year Treasury yield rising to nearly 4.6% at one point before retreating. Higher rates may make fixed income an attractive alternative to investors worried about the valuation of the stock market.
“If we don’t want to buy at all-time highs, you can now still earn good money in cash. Let it sit there, wait for a better entry point, and wait for it in certain stocks,” Liz Young Thomas, head of investment strategy at SoFi, said on “Halftime Report.”
The holiday-shortened week has been light on economic data, but a jobless claims report on Thursday showed both initial and continuing unemployment claims falling week over week.
Correction: A previous version misstated the day of the week.
