U.S. Stocks Decline as a New Year of Trading Begins

By Liz Moyer

U.S. stocks had a sluggish beginning to the new year as investors awaited the release of the Federal Reserve’s minutes from the latest meeting.

As of 11:07 ET (16:07 GMT), the major indices were down, with the Dow Jones Industrial Average falling 46 points or 0.1%, the S&P 500 dropping 0.3%, and the Nasdaq composite declining 0.6%.

The stock market finished 2022 with its weakest performance since 2008, attributed to rising interest rates that impacted growth and major technology stocks.

The Federal Reserve has been actively working to curb inflation, implementing the fastest series of interest rate hikes in decades, and it shows no signs of slowing down. During its December meeting, the central bank indicated that rates would continue to rise until it was confident that inflation was under control.

In 2022, the S&P 500 experienced a loss of over 19%, while the tech-heavy Nasdaq saw a decline of 33%.

Investors are keen to move past the previous year and are hopeful that upcoming economic data will provide some positive direction. A jobs report for December is scheduled for release on Friday, along with additional economic indicators coinciding with the Fed minutes.

Market expectations are leaning toward the Fed raising its policy rate by a quarter of a percentage point at its next meeting in February, signaling a slower pace of increases compared to recent months, yet still indicating an upward trend.

Shares of electric vehicle manufacturer Tesla dropped more than 11% on Tuesday after falling 65% throughout 2022, following lower-than-anticipated delivery numbers for both the quarter and the year.

In contrast, casino stocks saw gains as prospects for the reopening of China’s Macau gambling hub after COVID-related restrictions improved. Shares of Wynn Resorts rose 3.4%, and Las Vegas Sands climbed 2.8%.

In the commodities market, oil prices declined, with West Texas Intermediate down 1.7% to $78.91 a barrel and Brent crude falling 1.8% to $84.39 a barrel. Meanwhile, gold prices increased by 0.5% to $1,835 an ounce.