US stock index futures fell on Tuesday, bringing a gloomy tone to the first trading day of 2024, with Apple shares falling. Investors are back to strategizing based on last year's market.
The three major US stock indexes posted monthly, 3-month consecutive and annual gains last Friday amid traders assessing higher chances of interest rate cuts by the Federal Reserve this year based on lower inflation.
For 2023, all three major stock indices recorded double-digit increases. The S&P 500 closed on Friday up 1% from a record closing high reached on January 3, 2022. Waima as the opening of the year looked bleak with stock index futures on Tuesday, with the US 10-year bond yield, rising above 4.0% to level the previous two-week high, before falling back to 3.9594%.
Shares such as Nvidia, Tesla, and Alphabet were down between 0.7% and 1.1% in pre-market trading. Apple fell 1.8% after Barclays downgraded it to "underweight".
After an exceptional 2023, fueled by market optimism around artificial intelligence and stable interest rates, further inflation data and the looming presidential election will be the driving sentiment.
Market players are looking forward to the minutes of the meeting of the market makers from the Fed, which is scheduled to be released on Thursday Malaysia time. It is necessary to obtain an indication of the reduction of interest rates.
Investors see a nearly 90% probability the Fed will keep interest rates on hold at the January meeting, and around an 82% chance for a minimum cut of 25 basis points in March based on CME Group's FedWatch tool.
