The US benchmark equity indexes faced a downturn on Tuesday, primarily driven by notable declines in major technology stocks. The Nasdaq Composite recorded a significant loss of 1.9%, closing at 19,489.7, while the S&P 500 dropped by 1.1%, settling at 5,909. The Dow Jones Industrial Average experienced a minor decrease of 0.4%, ending the day at 42,528.4.
The technology sector emerged as the hardest-hit among all sectors, with materials showing little change. Notably, only the energy and health care sectors managed to close higher amidst the market's overall decline. Among the prominent technology stocks, Nvidia experienced a notable drop, with its shares declining by 6.2%.
This marked the largest decrease on the Dow and placed it among the worst performers on both the S&P 500 and Nasdaq indices. Other technology giants such as Amazon.com, Microsoft, and Apple were similarly listed among the underperformers on the Dow index. Electric vehicle manufacturer Tesla witnessed a 4.1% reduction in its stock price, making it one of the steepest decliners on the S&P 500.
Additionally, tech rivals Alphabet and Netflix also ended their trading sessions lower. On the corporate front, Meta Platforms announced a significant shift in its content management strategy by terminating its third-party fact-checking program in the United States, aiming to adopt a more personalized approach to political content.
This change comes as Meta seeks to fortify free expression across its platforms. Following this announcement, shares of the Facebook and Instagram parent company decreased by 2%. In a contrasting scenario, drugmaker Moderna emerged as the best performer on the S&P 500, with its stock soaring nearly 12%.
Such performance highlights the dynamic shifts within the healthcare sector amidst broader market trends. Moreover, Paychex announced a strategic acquisition deal to purchase Paycor HCM for $4.1 billion. This move is expected to enhance the human resources and payroll solutions provider's market positioning and boost its artificial intelligence capabilities.
Following the announcement, Paychex shares increased by 2.4%, making it the second-best performer on the Nasdaq, while Paycor's shares fell by 3%. A key highlight of the day was the US 10-year yield, which rose by 7.1 basis points to reach 4.69%, while the two-year rate gained 2.3 basis points, landing at 4.29%.
These upward movements in yields often signal changing investor sentiments in response to broader economic conditions. In terms of economic developments, the US services sector demonstrated unexpected growth last month, as business activity picked up, according to data released by the Institute for Supply Management.
Jefferies remarked that the improvement in the services purchasing managers' index is a positive signal amidst concerns of faltering data across other sectors. The government data released indicated an increase in US job openings for November, reaching the highest levels in six months, although layoffs saw a slight rise.
Additionally, the US trade deficit expanded in November as import growth outpaced export increases, as reported by the Census Bureau and the Bureau of Economic Analysis. On the retail front, online shopping hit a record high during the 2024 holiday season, with a majority of e-commerce transactions occurring on mobile devices.
This surge was fueled by the integration of artificial intelligence in driving traffic to retail websites, as evidenced by data from Adobe Analytics. In commodities, West Texas Intermediate crude oil prices rose by 1%, reaching $74.27 a barrel. Gold and silver also saw slight increases, closing at $2,664.80 per troy ounce and $30.65 per ounce, respectively..