New Year, New Market Trends
As the first trading day of 2025 kicked off, Wall Street saw a modest uptick, with the S&P 500 rising 0.2% and the Dow Jones Industrial Average increasing by 0.5%. The tech-heavy Nasdaq Composite also saw a 0.5% gain, following a brief market closure on Wednesday.
A Year of Growth
Despite a year-end slide, 2024 proved to be a remarkable year for US stocks, with the S&P 500 posting two consecutive years of over-20% gains – a feat not achieved in nearly three decades. Big Tech stocks, including Nvidia, Meta, and others, saw modest gains, driven by renewed optimism around artificial intelligence.
Tesla’s Slip
However, Tesla shares took a hit, falling over 4% after the electric vehicle maker reported its first annual decline in deliveries. The news was compounded by an incident involving a Cybertruck explosion in Las Vegas, which is currently under investigation.
Mortgage Rates on the Rise
Over the holiday week, US mortgage rates surged to 6.97%, reaching their highest level since early July. This increase weighed heavily on applications for home purchases and refinancing, according to the Mortgage Bankers Association.
Jobless Claims Fall
On a more positive note, weekly jobless claims dropped to their lowest level since March, with 211,000 claims filed, down from the previous week’s revised level of 220,000.
Corporate News
Apple shares fell 1.7% after the iPhone maker offered rare price discounts on its latest models in China, highlighting rising competition from local handset makers. Meanwhile, Alibaba’s stock dipped following news that the Chinese e-commerce giant would sell its shares in hypermarket chain Sun Art at a steep discount.
AI Chip Leader
Nvidia’s stock rose over 2%, leading the Nasdaq Composite higher, as investors continued to bet on the AI chip heavyweight’s growth prospects. Other “Magnificent Seven” stocks, including Meta and Amazon, also saw gains.
A New Year, New Opportunities
As the markets begin a new year, investors are eyeing a potential comeback after a year-end slide. With Big Tech stocks poised to continue their dominance and economic data pointing to a mixed bag, 2025 is shaping up to be an exciting year for Wall Street.
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