[New York Stock Market] Fatigue After Previous Day's Surge... Nasdaq Down 0.89%

The three major indices of the U.S. New York stock market all closed lower on the 16th (local time). Overall, the market was taking a breather after the sharp rise the previous day, but the Nasdaq index saw a significant drop as selling pressure intensified before the close.

On this day in the New York stock market, the Dow Jones Industrial Average (Dow), which focuses on blue-chip stocks, closed at 43,153.13, down 68.42 points (0.16%) from the previous trading day. The S&P 500 index, centered on large-cap stocks, closed at 5,937.34, down 12.57 points (0.21%) from the previous session. The tech-heavy Nasdaq index fell 172.94 points (0.89%) to close at 19,338.29.

U.S. retail sales for December fell short of expectations, but core figures showed strength, limiting the market impact. According to the U.S. Department of Commerce, December retail sales in the U.S. rose 0.4% month-over-month to $729.2 billion, below the market forecast of 0.5%. However, since the November retail sales growth rate was revised upward from 0.7% to 0.8%, December retail sales were considered not to deviate significantly from expectations, and the stock market showed little movement after the opening.

However, profit-taking following the previous day's sharp rise led to a generally weak stock market. Among individual stocks, tech stocks experienced the largest declines. Apple shares plunged 4.04%, marking the largest drop since August 5 last year. Tesla (-3.36%), Nvidia (-1.92%), and Alphabet (-1.3%) also declined.

Morgan Stanley’s stock rose more than 4% following better-than-expected Q4 earnings. Goldman Sachs also gained over 1%. Bank of America (BoA) reported strong earnings but showed a slight decline.

U.S. Treasury yields fell slightly. The U.S. 10-year Treasury yield, a global bond yield benchmark, dropped 4.3 basis points (1bp = 0.01 percentage points) to 4.61% compared to the previous trading day, while the 2-year Treasury yield, sensitive to monetary policy, fell 2.3 basis points to 4.24%.

Concerns about 'Trumflation' (inflation caused by Trump’s policies) persist, making it highly likely that the benchmark interest rate will remain unchanged for the time being. According to the Chicago Mercantile Exchange (CME) FedWatch, the federal funds futures market on this day reflected a 97.3% probability that the Fed will keep rates unchanged at the Federal Open Market Committee (FOMC) meeting scheduled for the 28th-29th. The probabilities of rate freezes in March and May are 70.1% and 52.1%, respectively.

However, Federal Reserve Governor Christopher Waller said on this day that if inflation eases as expected, the Fed could cut the benchmark interest rate multiple times. Waller was previously classified as a hawk during the rate hike cycle.

International oil prices fell due to expectations of eased Middle East tensions following a Gaza ceasefire and profit-taking trades. West Texas Intermediate (WTI) crude oil closed at $78.68 per barrel, down $1.36 (1.70%) from the previous day. On the ICE Futures Exchange, the global benchmark Brent crude for March delivery closed at $81.29 per barrel, down $0.74 (0.90%) from the previous session.