The Nasdaq Composite closed lower on Thursday for a fifth consecutive losing session — its longest losing streak since October 2022.
The tech-heavy Nasdaq Composite dipped 0.56%. Since the Dec. 27 close, the index has lost nearly 4%. The S&P 500 slid 0.3% for a fourth losing day. The Dow Jones Industrial Average was the outlier, eking out a 10.15-point gain, or 0.03%.
Mega-cap tech stocks such as Apple are underperforming to start the year, as overstretched valuations and uncertainty around when the Federal Reserve will begin to cut rates have investors worried that markets have gotten overly optimistic.
Apple stock is down more than 5% this week. Shares of the tech giant fell more than 1% on Thursday following a downgrade by Piper Sandler, two days after Barclays also lowered its rating on the name.
The recent performance on Wall Street comes in stark contrast to how the market ended 2023. The S&P 500 ended last year up more than 24% while enjoying its best weekly win streak going back to 2004.
In fact, Wieting thinks the S&P 500 could end the year around the 5,000 level, which would indicate more than 6% upside from here.
In Europe, Carrefour has decided to stop selling products from PepsiCo, including brands like Pepsi, Lay’s crisps, and 7up, in four European countries (France, Italy, Spain, and Belgium) due to what it considers “unacceptable price increases.” This move affects over 9,000 Carrefour stores in these countries, which make up two-thirds of the retailer’s global footprint. The decision reflects the ongoing pricing disputes between retailers and global food giants. Other grocery retailers in countries like Germany and Belgium have also taken similar actions in negotiations with consumer goods companies, as price discussions have become more challenging due to inflation. PepsiCo has stated that they have been in discussions with Carrefour for several months and intend to continue engaging in good faith to ensure their products remain available in the stores.
Turning to commodities, oil prices dropped on Thursday due to a significant increase in U.S. fuel inventories, which overshadowed concerns about rising tensions in the Middle East. The West Texas Intermediate contract for February fell by 0.7% to settle at $72.19 a barrel, while the Brent contract for March declined by 0.84% to settle at $77.59 a barrel. This drop was primarily attributed to a substantial 10.9 million barrel increase in U.S. gasoline stocks, reaching a total of 237 million barrels for the week ending December 29, according to data from the Energy Information Agency. Additionally, the indicator of demand, motor fuel supplied to the market, decreased by 1.2 million barrels per day, totaling nearly 8 million barrels per day. Consequently, the market’s attention shifted away from concerns about the Middle East tensions, which had briefly driven crude prices up by more than 2% on the previous day due to militant attacks disrupting shipping in the Red Sea and protests causing the shutdown of a Libyan oilfield.