US equity benchmarks closed lower Tuesday, with technology stocks dragging the S&P 500 (SP500) down 1.04% to 5,924.53, with technology being the worst-performing sector.
Picture: S&P 500 consolidates near 5924 after testing 5890 support, with bearish momentum showing signs of easing, as seen on the VT Markets app.
The chart displays a bearish movement, with the S&P 500 index closing lower than its opening price and registering a daily decline of 1.04%.
The price remained below key short-term moving averages, while the MACD indicator confirmed sustained selling pressure. A breach of 5907 could lead to further declines, with 5900 being the next critical level to watch.
The tech sector’s dip came with a swing from the 10-year Treasury yield, which climbed 7.1 basis points to 4.69%.
With faster-than-expected growth seen in the US services sector in December, market participants are expecting encouraging improvements through the fog of mixed economic signals. Job openings rising to 8.098 million in November were also a prime factor to the sector’s movements.
The technology sector saw massive gains in 2024, driven by enthusiasm over AI and other emerging technologies. Stocks like Nvidia, Microsoft, and Tesla were among the top performers last year, leaving them vulnerable to profit-taking as investors reassess valuations.
The selloff in major tech stocks reflects caution among investors as rising Treasury yields and strong economic data temper expectations of near-term Fed rate cuts.
While energy and health care sectors provided some support, the focus remains on upcoming data releases to gauge the trajectory of the US economy and monetary policy.
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