Why Is The Stock Market Down Today? Can the Stock Market Regain its Mojo?
Jan 08, 2024
Why is the stock market down today? Here is why. The stock market was met with turbulence last week amidst a few significant developments. As Apple announced that its revenue growth in the upcoming fiscal year is predicted to be tepid at best, the company’s shares plunged 5.9%. Conversely, Boeing enjoyed a 36.8% surge in 2023 due to the revival of travel and fresh orders. However, its shares suffered a 4.5% dip last week.
An incident of fuselage blowout on a Boeing 737 9 Max plane during takeoff from Portland, Oregon, has added uncertainty about the company’s performance in the coming weeks. Consequently, the Federal Aviation Administration has grounded 171 737 Max planes currently operating in the United States until safety inspections are completed.
Meanwhile, interest rates slightly increased last week, with the 10-year Treasury yield reaching 4.046% on January 5, the first time it has closed above 4% since December 13. Additionally, crude oil prices climbed 3% to $73.81 a barrel, but the national average price of gasoline slightly fell to $3.079 a gallon, as reported by the American Automobile Association.
Corporate stress is continuing to increase, with Xerox Holdings planning to cut its global workforce by 15% and Walgreen Boots Alliance reducing its dividend by 28%. Tesla‘s shares also fell 4.4% to $247.49 due to news of it being outperformed by China’s BYD as the best-selling electric vehicle maker.
Despite these challenges, the jobs report released last Friday offered a glimmer of hope. The initial estimate suggested that payrolls expanded by approximately 216,000 in December, exceeding November’s 173,000 and surpassing expectations. The unemployment rate remained stable at 3.7%.
Looking forward, there are high expectations for January 10’s decision by the Securities and Exchange Commission regarding the approval of exchange-traded funds for cryptocurrencies. Numerous asset managers, including BlackRock and Fidelity Investments, are seeking to gain approval for this initiative. The first crypto ETF is anticipated to be based on Bitcoin, which increased 3.5% this week to $44,000, marking its first close above $45,000 since April 5, 2022.
For the week ahead, economic reports to look out for include the Consumer Price Index report and the weekly Jobless Claims report. The Federal Reserve will be paying close attention to this data as it could influence their decision about when to start cutting interest rates.Lastly, the earnings season is gearing up to go full swing, with a slew of financial giants such as JPMorgan Chase, BlackRock, Citigroup, Bank of America, Wells Fargo, and Bank of New York Mellon set to report their earnings. So now you know the answer to the question: why is the stock market down today? For sure.