Slow Start for December for Stock Market
Stocks are looking bearish as December starts, extending the tech stock downtrend for at least a while longer.
Quick overview
- All three major U.S. stock indices fell slightly at the start of December, indicating a poor shopping season.
- The Dow dropped 0.43%, while the Nasdaq and S&P 500 fell 0.20% and 0.19%, respectively.
- Tech stocks continue to struggle, with major companies like Microsoft, Alphabet, and Meta all experiencing declines.
- Despite the overall downturn, AMD and Nvidia showed gains, highlighting some resilience in the AI sector.
As December trading began on Monday, all three major U.S. stock indices fell slightly and indicated that the shopping season was off to a poor start.
The Dow faltered with a drop of 0.43% to begin December on a low note. That downturn was accompanied by the Nasdaq falling 0.20% and the S&P 500 dipping 0.19%. At the same time, the cryptocurrency market fell, with Ethereum (ETH) and Bitcoin (BTC) losing 8.31% and 7.36%, respectively.
This was a less than auspicious start for the month and painted a bleak picture for the weeks ahead. There is promise of an upswing on the horizon, though, as the Federal Reserve will be making a decision soon as to whether they will issue a rate cut or not. Market sentiment says they are very likely to do so.
Tech Stocks Continue to Struggle in December
The minor drop in the stock market tells a larger story than simply that the market is having some difficulty at the moment. The decline is mostly led by tech stocks and their continued slip away from October highs.
For weeks, technology stocks have been falling as investors fears grow. The worry they have is that the AI market will begin to shrink dramatically after growing so rapidly in recent years. So far, those fears have not been confirmed, but it is obvious that tech stocks are still under some intense selling pressure.
Microsoft (MSFT) dropped further as the week opened, losing 0.75% and continuing its weeks-long bullish streak. Alphabet (GOOGL) also declined 0.68% on Monday, and Meta Platforms (META) fell 0.68% as well. These are all companies that have invested heavily into artificial intelligence and that have had trouble getting back to their October levels. For now, all signs point to continued difficulty in the tech sector and the wider stock market in making gains.
Advanced Micro Devices (AMD) and Nvidia (NVDA) both made some progress on Monday, however, bucking the wider bullish trend for tech stocks. AMD gained 0.68%, and NVDA added 1.64%, showing that AI stocks can perform well when the wider stock market is dipping. Nvidia made a decision to invest $2 billion in the company Synopsis as part of a long-term growth plan. Advanced Micro Devices is positioning itself as a strong rival for Nvidia, and their efforts there have been paying off as the AI market continues to grow despite fears that it has become a bubble market.
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