US STOCKS Wall St falters at Start of 2023 as Apple and Tesla Shares Fall

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Tesla misses Q4 deliveries

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Apple hits lowest since June 2021

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Indexes down: Dow 0.58%, S&P 0.85%, Nasdaq 1.26%

(Adds comments and updates prices throughout

By Ankika Biswas and Amruta Khandekar

Jan 3, 2019 (Reuters) – Wall Street’s major indexes fell on the first trading day in 2023, due to large losses in Tesla and Apple. Investors waited minutes for the Federal Reserve’s last policy meeting for further clarity about the direction of interest rate increases.

After missing Wall Street estimates for quarterly deliveries, the electric vehicle maker dropped 13.7%. iPhone maker Apple Inc declined 3.9% to its lowest point since June 2021 due to a rating decline resulting from production cuts in China.

Technology stocks and consumer discretionary stock fell more than 1%.

The energy sector, which saw impressive gains in 2022, fell 2.7%. This was due to lower oil prices and concern about the outlook for global economic growth amid recession fears.

Other rate-sensitive technology growth stocks, such as Alphabet Inc. Meta Platforms Inc. and Amazon.com Inc, were also up between 0.9% & 2.9%.

“The market isn’t about news or fundamentals, it’s more emotional about a start to a new year, and investors trying decide if there is a recovery in front of them,” Rick Meckler of Cherry Lane Investments, New Vernon, New Jersey.

“Given the poor performance of last year, I would definitely expect a better one this year.”

After the Fed’s rapid rate of rate increases since the 1980s, which was meant to end decades-high inflation, the major stock indexes suffered their largest annual losses since 2008 and ended 2022 with the steepest annual losses.

The S&P 500 shed 19.4% in 2022, marking a roughly $8 trillion decline in market capitalization, while the Nasdaq fell 33.1%, dragged down by growth stocks.

Investors will be watching closely Wednesday’s minutes of the Fed’s December policy meeting. This was when the Fed raised interest rates by 50 basis point after four straight 75-bps rises. They also signaled that rates might stay higher for a longer time.

The ISM manufacturing report and December’s jobs report are two other economic data that will be available this week.

Although weakness in the labor markets could be a reason for the Fed to loosen its monetary policy, the data so far shows that the market remains tight, despite the interest rate rises.

The money market participants believe there is a 68% chance that Fed will raise benchmark rate 25 bps, to 4.50%-4.75% February. Rates peak at 4.98% June.

At 12:17 pm. ET, the Dow Jones Industrial Average was down 190.79 points, or 0.58%, at 32,956.46, the S&P 500 was down 32.46 points, or 0.85%, at 3,807.04, and the Nasdaq Composite was down 131.84 points, or 1.26%, at 10,334.64.

U.S.-listed Chinese companies such as Alibaba Group Holding Ltd, JD.com Inc and Pinduoduo Inc rose between 1 and 4 percent on post-COVID recovery hope.

NYSE: 1.16 to 1 ratio, Nasdaq: 1.08 to 1.

The S&P index recorded one new 52-week highs and 5 new lows, while the Nasdaq recorded 80 new highs and 32 new lows. Reporting by Shubham Batra and Ankika Biswas in Bengaluru; Editing done by Shounak Dasgupta & Arun Koyyur