Tech Slump Leads Market Dip as Investors Eye Trump's Trade Moves and Fed Signals

Word on the StreetWednesday, Nov 27, 2024 2:00 pm ET

1min read

On Wednesday, U.S. stocks experienced a downturn by midday, primarily led by declines in the technology sector, with the Nasdaq Composite shedding over 1%. The market was closely watching developments around former President Trump's trade policies and the composition of his new cabinet. Additionally, reports indicated that the U.S. real GDP growth for the third quarter slowed compared to the previous quarter.

The Dow Jones Industrial Average fell by 43.12 points, or 0.10%, to 44,817.19, while the Nasdaq Composite dropped 205.87 points, marking a 1.07% decline to 18,969.70. The S&P 500 slipped 29.58 points, a decrease of 0.49%, closing at 5,992.05.

Earlier in the day, the Dow momentarily surged past the 45,000 mark, reaching an intraday high, marking a historic milestone. However, the gains were reversed as investors digested various economic and policy announcements.

The U.S. Department of Commerce reported a 2.3% year-over-year increase in the Personal Consumption Expenditures (PCE) price index for November, aligning with market expectations. This metric is notably favored by the Federal Reserve as an inflation measure. The central bank is currently assessing this data to inform its future rate cut decisions.

Market participants are also evaluating the implications of the Federal Reserve's recently released meeting minutes from November, which highlighted expectations for continued rate cuts, albeit at a "gradual" pace.

Amidst these developments, investors remained on edge regarding Trump's potential trade moves, as he has promised to impose new tariffs on Canadian, Mexican, and Chinese imports, which could stir retaliatory measures. His administration's trade policy appointments have been perceived as a continuation of his aggressive stance on international trade.

As the holiday season approaches with Thanksgiving on Thursday, U.S. financial markets will mostly close, and on Friday, early trading hours are anticipated with low volumes expected.

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