[New York Stock Market] Three Consecutive Days of Decline... "Santa Rally" Fades Further

Concerns Over AI Bubble Amid Lack of Market Catalysts
Silver Rebounds Over 8% After Plunge From Record High
FOMC Minutes Reveal Disagreements Over December Rate Cut
Most Members Say "Further Cuts Appropriate if Inflation Falls"

On December 30 (local time), the three major U.S. stock indexes closed lower for the third consecutive trading session. Following a decline the previous day due to the poor performance of artificial intelligence (AI)-related stocks, the lack of a clear market catalyst and weakening expectations for a "Santa Rally" are becoming apparent. Meanwhile, the price of silver, which had plunged from an all-time high the previous day, rebounded by about 8% on this day.

A trader is working on the floor of the New York Stock Exchange (NYSE) in the United States. Photo by AFP

On this day at the New York Stock Exchange, the blue-chip Dow Jones Industrial Average ended the session at 48,367.06, down 94.87 points (0.2%) from the previous trading day. The large-cap S&P 500 Index fell by 9.5 points (0.14%) to 6,896.24, while the tech-heavy Nasdaq Composite dropped by 55.27 points (0.24%) to close at 23,419.08.

By sector, Meta, the parent company of Facebook, which acquired Manus, a Singapore-based startup developing general-purpose AI agents, rose by 1.11%. Applied Digital, which announced it would spin off its cloud division and merge it with Exo Bionics, initially showed strength but reversed course to finish down 2.94%. Nvidia declined by 0.36%, and Palantir fell by 1.81%.

There are mixed opinions in the market regarding the sustainability of the AI rally.

Bill Noshi, Senior Investment Strategist at US Bank Asset Management, stated, "As we move into 2026, companies that improve productivity and increase profits through AI adoption will stand out even more. In the early stages, machinery and component companies, such as semiconductor and major raw material producers, were the biggest beneficiaries. While leadership was somewhat limited this year, there will be opportunities to expand that scope in 2026."

Barbara Doran, CEO of BD8 Capital Partners, said in an interview with CNBC, "There are concerns in the current market that an excessive AI bubble may be forming."

With few major economic indicators scheduled for release and trading volumes thinning toward year-end, investors focused on the minutes of the Federal Reserve's December Federal Open Market Committee (FOMC) meeting released on this day. According to the minutes, there were significant differences of opinion among committee members regarding a rate cut this month.

The minutes stated, "Among the committee members who supported a policy rate cut at this meeting, some felt the decision was at a very delicate balance and could have also supported maintaining the target range." Previously, the Fed lowered the benchmark interest rate by 0.25 percentage points to a range of 3.5% to 3.75% at the regular FOMC meeting held on the 10th. The latest minutes once again confirmed the internal differences at that time.

However, the minutes also noted, "Most participants mentioned that shifting to a more neutral policy stance would help prevent a severe deterioration in labor market conditions," and "Even among those who preferred or could have supported maintaining the target range, many believed that a substantial amount of labor market and inflation data to be released before the next meeting would help determine the justification for a rate cut."

The price of silver rebounded by 8% on this day after plunging from an all-time high the previous day.

U.S. Treasury yields remained steady. The 10-year U.S. Treasury yield, a global bond market benchmark, rose by 1 basis point (1bp = 0.01 percentage point) from the previous day to 4.12%, while the 2-year U.S. Treasury yield, which is sensitive to monetary policy, fell by 1 basis point to 3.44%.