U.S. stocks slipped on Monday as investors weighed expectations of further interest rate cuts by the Federal Reserve, while gold retreated from record highs in a holiday-shortened week.
According to Reuters, the Dow Jones Industrial Average fell 219.42 points, or 0.46 per cent, to 48,489.11. The S&P 500 declined 24.21 points, or 0.35 per cent, to 6,905.73, while the Nasdaq Composite dropped 117.42 points, or 0.50 per cent, to 23,474.13.
The decline was driven by weakness in technology and materials stocks, Reuters reports, as investors assessed economic data and Federal Reserve policy signals for 2026. Treasury yields eased, and the dollar hovered near its lowest level in almost three months, reflecting ongoing market expectations of further Fed rate cuts.
“It’s a very light trading week ahead; volume is low, so any kind of activity could push the index one way or the other,” said Sam Stovall, chief investment strategist of CFRA Research in New York, according to Reuters. “Possibly you have people who have decided to sell, and they want to do some tax loss harvesting.”
Market participants were also monitoring developments in U.S.-Ukraine negotiations, with hopes for a peace deal following discussions between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskiy. Reuters reports that optimism for a deal was dampened after Russian authorities said Ukraine attempted an attack on President Vladimir Putin’s residence.
Despite Monday’s pullback, U.S. and global stocks remain on course for double-digit gains in 2025, Reuters notes, marking a strong end to a tumultuous year dominated by trade tensions, central bank policy changes, and geopolitical uncertainties.
European markets steadied near record highs, with gains in basic resources firms offset by weakness in defence stocks.
MSCI’s gauge of global stocks fell 0.21 per cent to 1,020.75, while the pan-European STOXX 600 rose 0.07 per cent, and the FTSEurofirst 300 index increased 0.07 per cent. Emerging market equities advanced 0.28 per cent to 1,401.35, and Asia-Pacific shares outside Japan rose 0.3 per cent. Japan’s Nikkei declined 0.44 per cent to 50,526.92, Reuters reports.
In the currency markets, the dollar index fell 0.03 per cent to 98.00, while the euro rose 0.09 per cent to $1.1782. The dollar weakened 0.22 per cent against the Japanese yen to 156.19. U.S. Treasury yields edged lower, with the 10-year note at 4.124 per cent and the 30-year bond at 4.808 per cent.
Oil prices rose sharply on hopes for progress in the U.S.-Ukraine talks and potential supply disruptions in the Middle East. U.S. crude gained 2.47 per cent to $58.14 per barrel, while Brent crude rose 2.26 per cent to $62.01. Conversely, gold fell 4.66 per cent to $4,321.25 per ounce, and U.S. gold futures declined 3.31 per cent to $4,379.00 per ounce, Reuters reports.
