Stocks experienced a notable decline on Monday, extending the downward trend from last Friday's trading. The main indices pulled back to levels close to the one-month lows seen earlier this month.
As of now, the major indices are hovering slightly above their session lows. The Dow Jones Industrial Average has decreased by 691.02 points, or 1.6%, standing at 42,301.19. The Nasdaq Composite has fallen by 348.51 points, or 1.8%, to 19,373.52, while the S&P 500 is down by 94.14 points, or 1.6%, at 5,876.70.
This prolonged downturn on Wall Street is partially attributed to ongoing weakness in technology stocks, likely driven by profit-taking as the year concludes.
Despite the current setbacks, the major indices are still on track to record significant gains for 2024, with the tech-centric Nasdaq up 29.1% for the year at present.
Networking stocks are among the hardest hit within the tech sector, pushing the NYSE Arca Networking Index down 2.2%.
Significant declines are also seen in computer hardware and semiconductor stocks, with the NYSE Arca Computer Hardware Index and the Philadelphia Semiconductor Index dropping by 2.1% and 2.0%, respectively.
Beyond the tech sector, airline stocks have experienced a notable downturn, leading to a 2.4% drop in the NYSE Arca Airline Index.
Gold, retail, and telecom stocks are also showing marked weakness, falling alongside most of the other major sectors.
Adding to the Dow's weight are shares of Boeing (BA), which have plummeted by 3.7%. This follows an order by South Korea's Transport Ministry to inspect B737-800 aircraft after the tragic Jeju Air crash over the weekend.
However, it's possible that the market's broad downturn is being overstated by lower-than-usual trading volumes, as many traders have left their desks ahead of Wednesday's New Year's Day holiday.
In U.S. economic developments, the National Association of Realtors reported a more significant-than-anticipated surge in pending home sales for November.
According to NAR, the pending home sales index rose by 2.2% to 79.0 in November, following a 1.8% increase to 77.3 in October. Economists had forecast a 0.7% rise in pending home sales.
The pending home sales index has increased for four straight months, reaching its highest point since February 2023.
In international markets, stock exchanges in the Asia-Pacific region predominantly moved lower on Monday. Japan's Nikkei 225 Index fell by 1.0%, and South Korea's Kopsi dipped by 0.2%. Conversely, China's Shanghai Composite Index defied the trend with a modest rise of 0.2%.
Meanwhile, all major European markets have trended downward. Germany's DAX Index has declined by 0.4%, and both France's CAC 40 Index and the U.K.'s FTSE 100 Index have decreased by 0.6%.
In the bond markets, treasuries have regained some ground following last Friday's weakness. Consequently, the yield on the benchmark ten-year note, which moves inversely to its price, is down by 7.6 basis points, standing at 4.543%.
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