TheBlackSnack

The stock market’s slump in 2024 is showing no signs of abating, with tech stocks facing particular challenges. On Thursday, the Dow Jones Industrial Average closed just above the flatline, while the S&P 500 fell by about 0.3%. The Nasdaq Composite, in particular, struggled to gain traction, falling nearly 0.6% below the flatline by the close of the session¹.

Apple Stock Continues to Stumble

One of the notable tech giants facing a downward trend is Apple. The company’s stock stumbled for the fourth consecutive day, raising concerns among investors about weakening iPhone demand¹. This decline in Apple stock is significant, as it is a key player in the tech sector and its performance often influences market sentiment.

Labor Market Remains Intact

Despite the stock market struggles, there are positive signs in the labor market. Multiple data points released on Thursday indicate that the labor market remains intact while wages continue to cool, which is a welcome sign in the fight against inflation¹. The latest ADP employment report shows that private companies added 164,000 jobs in December, surpassing analysts’ expectations¹. Additionally, the Department of Labor reported that 202,000 jobless claims were filed last week, which is below economist estimates¹.

Oil Prices and Travel Stocks

Oil prices experienced a decline on Thursday, with West Texas Intermediate (WTI) sinking more than 2% due to increased gasoline stockpiles signaling weak demand¹. However, this decline in oil prices has had a positive effect on travel stocks. Cruise line and airline operators, such as American Airlines, Delta, United, Royal Caribbean, and Carnival, saw their stock prices rise as lower oil prices imply lower fuel costs for these companies¹.

December Jobs Report Anticipation

Investors are eagerly awaiting the release of the December jobs report, which is expected to provide further insights into the state of the labor market at the end of 2023¹. Consensus estimates compiled by Bloomberg suggest that nonfarm payrolls are expected to rise by 175,000 in December, while the unemployment rate is expected to tick up to 3.8% from the previous month¹. The report will be closely watched as it will serve as a crucial test for the stock market’s end-of-year rally.

Tech Stocks Highlighted on Yahoo Finance

On Thursday, Yahoo Finance highlighted the trending tickers in the stock market. QuantumScape Corporation (QS) led the trending tickers page, with its stock surging almost 50% after its solid-state cell passed its first endurance test¹. However, Mobileye Global (MBLY) stock dropped by approximately 25% after the chipmaker announced an expected decline in first-quarter revenue¹. Walgreens (WBA) stock fell about 6% after reporting quarterly results and announcing a dividend cut¹. On the positive side, Peloton (PTON) stock soared more than 15% following the announcement of a partnership with TikTok¹.

Mortgage Rates and Housing Market

Mortgage rates, after experiencing a significant fall, have stalled at the beginning of 2024¹. The average rates for 30-year loans inched up slightly, but they have been declining for weeks, providing homebuyers with increased purchasing power¹. However, affordability improvements could be limited due to a continual supply shortage, especially if lower rates attract sidelined demand¹.

Earnings Season and Stock Market Rally

Despite the rough start to the year, some analysts believe that earnings season could drive a stock market rally¹. Analysts expect S&P 500 companies to report earnings growth of 11.7% for the full year, which is above the 10-year average annual earnings growth rate¹. Bank of America sees nearly 10% growth for the S&P 500 from current levels, with the upcoming earnings season being a key factor in driving the market¹.

Conclusion

The stock market’s slump continues, with tech stocks facing particular challenges. Apple’s stock has stumbled for four consecutive days, raising concerns about weakening iPhone demand¹. However, there are positive signs in the labor market, as multiple data points indicate that the labor market remains intact while wages continue to cool¹. Additionally, lower oil prices have had a positive effect on travel stocks, while investors eagerly await the release of the December jobs report¹. Despite the rough start to the year, earnings season could be a catalyst for a stock market rally¹. As the market moves forward, investors will be closely monitoring these developments to assess the overall health and trajectory of the stock market.