Janux stock plunges after hours following mCRPC trial data
Investing.com - The S&P 500 closed lower Monday, as cautious trading kicked off the final trading month of the year just weeks ahead of a widely expected interest rate cut by the Federal Reserve.
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At 4:00 p.m. ET (20:00 GMT), the benchmark S&P 500 had dropped 0.4%, the tech-heavy Nasdaq Composite slipped 0.4%, and the blue-chip Dow Jones Industrial Average fell 427 points, or 0.9%.
Last week, which was shortened by the Thanksgiving holiday, all three of major indices gained by more than 3%. The S&P 500 and Dow Jones Industrial Average also closed out a positive November, although the Nasdaq ended down 1.51%, echoing recent concerns over the sustainability of soaring tech valuations and soaring -- and often debt-fueled -- spending on artificial intelligence.
Underpinning sentiment have been increasing bets that the Fed will deliver a quarter-point interest-rate cut at its December 9-10 gathering. The odds of a cut have soared to around 88% from roughly the mid-40s-percentage level only a little over a week ago.
Dovish signals from Fed officials -- including comments suggesting that conditions may warrant a rate reduction -- have helped fuel those expectations, though uncertainty remains given limited fresh data because of a recent federal government shutdown.
This week will see a raft of U.S. economic data, including gauges of manufacturing and services sector activity, consumer sentiment, and private payrolls. Big-box retailers will also likely be under the spotlight after figures indicated a surge in online spending during the annual Black Friday sales event last week.
Next Fed Chair appointment in focus
At the same time, markets are assessing President Donald Trump’s statement that he has decided on his pick for the next Federal Reserve chair, although Trump declined to provide the exact name.
According to recent reports, the shortlist under consideration includes White House economic adviser Kevin Hassett, former Fed Governor Kevin Warsh, and current Fed Governor Christopher Waller. Hassett is reportedly the frontrunner for the role, but he downplayed these predictions, saying only that he would be "happy to serve."
A shift in leadership could influence the Fed’s policy trajectory significantly. Reports have repeatedly indicated that Trump could select a close ally to replace current Fed Chair Jerome Powell, whose term ends in May.
Given Trump’s repeated calls for aggressive and rapid rate cuts, this could signal a more “dovish” change in looser monetary policy, which could further support equities, especially rate-sensitive sectors such as retail and growth stocks.
Powell is due to speak later in the day. However, the Fed is currently in its pre-meeting blackout phase, meaning he is not anticipated to provide fresh comments on the trajectory of interest rates.
Strategy leads plunge in crypto-related stocks as bitcoin slips
Strategy Inc (NASDAQ:MSTR) fell more than 3% as the company’s cut its guidance and sold stock to fund a $1.44B cash reserve in an attempt to ease concerns that bitcoin Treasury management company may have to sell some of its massive $56B crypto assets.
Other-crypto stocks including Riot Platforms (NASDAQ:RIOT), Marathon Digital Holdings Inc (NASDAQ:MARA), and Coinbase Global Inc (NASDAQ:COIN) were also under pressure as Bitcoin (BitStampUSD) slumped 7%.
The move lower in bitcoin has coincided with signs of reduced activity on the network as active addresses and transfer volumes cooled. A recent surge in inflows into bitcoin ETFs, meanwhile, following massive outflows last month hasn’t yet stabilised selling in the popular crypto.
(Scott, Kanowsky, Ayushman Ojha contributed reporting.)