Tech Weakness Drags Down Equities Amid Mixed Market Signals

Major U.S. stock indices are retreating today as weakness in megacap technology shares weighs heavily on overall market sentiment. The S&P 500 has declined by -0.24%, while the Nasdaq 100 mirrors this weakness with a -0.24% drop. The Dow Jones Industrials shows slightly more resilience, down just -0.09%. Futures markets point to continued pressure, with March E-mini S&P 500 futures trading -0.28% lower and March E-mini Nasdaq futures off -0.27%.

The technology sector’s underperformance is the primary culprit behind today’s equity selloff. Within the Magnificent Seven, most heavyweights are trading in negative territory. Nvidia and Tesla lead the losses with declines exceeding -1%, while Meta Platforms drops -0.82%, Alphabet retreats -0.40%, and Amazon.com slides -0.23%. Microsoft shows minimal weakness at -0.02%, and Apple bucks the trend with a modest +0.15% gain. This broad-based softness in large-cap technology has cascading effects across the broader market.

Precious Metals Trigger Broad-Based Selling

Profit-taking pressure has emerged in precious metals markets following parabolic rallies that pushed both silver and platinum to fresh record highs. The sharp reversals have sparked significant technical selling, with both metals declining sharply from their peaks. Adding to the selling pressure, the CME raised margin requirements for precious metals trading, triggering forced long liquidations.

Mining stocks are bearing the brunt of this metals weakness. Gold prices have tumbled more than -3%, while silver has plunged more than -7% from its record high. This volatility is crushing mining equities. Hecla Mining tumbles more than -6%, Newmont falls more than -5% to rank among the S&P 500’s worst performers, Coeur Mining drops more than -4%, and Freeport-McMoRan declines more than -2%.

Energy Strength Provides Market Support

In contrast to the weakness elsewhere, crude oil prices have surged more than +2%, providing a bright spot for the equity market. Geopolitical tensions spanning from Venezuela to Nigeria support crude values. Additionally, China’s Ministry of Finance announced plans to broaden fiscal spending next year, bolstering demand expectations for energy.

The Ukraine-Russian conflict remains a factor, as advanced peace negotiations over the weekend failed to produce a breakthrough, sustaining geopolitical premiums in oil. Energy sector equities are responding positively, with Devon Energy, Marathon Petroleum, Halliburton, APA Corp, Diamondback Energy, ConocoPhillips, and Occidental Petroleum all trading more than +1% higher. Chevron leads Dow Jones gainers with a +0.63% advance.

Fixed Income Finds Safe-Haven Appeal

Bond markets are benefiting from equity market uncertainty. March 10-year Treasury notes have risen +4 ticks, pushing the 10-year yield down -1.6 basis points to 4.112%, marking a one-week low. The flight to safety reflects both domestic equity weakness and international geopolitical risks. European government bonds are following suit, with the 10-year German bund yield declining to a 1.5-week low of 2.836%, down -1.4 basis points, and the 10-year UK gilt yield falling to a one-week low of 4.459%, down -0.7 basis points to 4.500%.

Individual Stock Highlights

Beyond sector trends, select companies are capturing market attention. Praxis Precision Medicine surges more than +14% following FDA breakthrough therapy designation for ulixacaltamide in treating essential tremor. DigitalBridge Group jumps more than +9% after SoftBank Group’s acquisition announcement at $16 per share, valued at approximately $4 billion. Coupang advances more than +1% following the company’s commitment to offer over $1 billion in customer compensation related to a data breach incident.

Looking Ahead: Economic Calendar and Market Expectations

This holiday-shortened week will feature several important economic releases. Pending home sales for November are forecast to rise +1.0% month-over-month. The December MNI Chicago PMI is expected to increase by +3.5 points to 39.8. The Federal Reserve will release minutes from its December 9-10 policy meeting. Initial weekly unemployment claims are projected to increase by 1,000 to 215,000. Manufacturing activity, measured by the December S&P PMI, is expected to remain flat at 51.8.

Market participants are currently assigning just a 19% probability to a -25 basis point rate cut at the January 27-28 FOMC meeting, suggesting expectations for policy stability. Seasonal strength typically supports equities during this period—historical data from Citadel Securities shows the S&P 500 has risen 75% of the time during the final two weeks of December since 1928, averaging a 1.3% gain.

International Markets Show Mixed Performance

Global equity markets display divergent trends. The Euro Stoxx 50 edges higher by +0.17%, while China’s Shanghai Composite climbs to a six-week high, posting its ninth consecutive daily advance with a +0.04% close. Japan’s Nikkei Stock 225, however, closes with weakness at -0.44%.