Wall Street closed lower on its first trading session of 2025, despite solid labor market data. Tesla’s stock fell 6.1% after reporting a decline in deliveries, while crypto stocks rose along with Bitcoin. Energy shares gained due to rising crude prices.
The Labor Department reported a decrease in initial and continuing claims for unemployment benefits, supporting the narrative of a strong jobs market. This news may lead to the Federal Reserve keeping interest rates steady at its upcoming policy meeting.
Despite this positive data, investors remained cautious due to various uncertainties, including the pace of interest rate cuts from the Fed, policies from the incoming Trump administration, and geopolitical tensions. The main indexes, S&P 500, Dow Jones Industrial Average, and Nasdaq Composite, all ended in negative territory.
The S&P 500 recorded its best two-year run since 1997-1998, driven by the Federal Reserve’s rate cuts and the artificial intelligence boom. However, this rally lost steam in December as markets priced in fewer rate cuts from the Fed this year.
Source: https://www.reuters.com/markets/us/futures-rise-ahead-wall-sts-first-trading-session-2025-2025-01-02