United States equity benchmarks began December in negative territory on Monday (Tuesday AEDT), weighed down by a rebound in Treasury yields and fresh economic data showing that tariffs continued to drag on the manufacturing sector.
The latest survey from the Institute for Supply Management showed U.S. manufacturing contracted for a ninth straight month in November, with factories reporting weaker orders and rising prices amid persistent tariff pressures.
The Dow Jones Industrial Average fell 427.1 points or 0.9% to 47,289.3, the S&P 500 slipped 36.5 points or 0.5% to 6,812.6 and the Nasdaq Composite lost 89.8 points or 0.4% to 23,275.9.
Bitcoin added to the risk-off tone, tumbling 4.7% to trade around the US$86,250 level.
Crypto-linked shares, Coinbase and Strategy, retreated 4.8% and 3.3% respectively in Monday’s session.
The pullback extended to parts of the artificial intelligence trade, with Broadcom down 4.2% and Super Micro Computer losing 1.3%.
However, Synopsys jumped 4.9% after Nvidia announced a $2 billion investment in the semiconductor design platform. Nvidia shares rose 1.7%.
Retail names outperformed as holiday shopping accelerated. Home Depot and Walmart ticked up 0.1% and 0.9%.
Big-box retailers were also in focus on Cyber Monday, with online spending expected to reach $14.2 billion, according to Adobe Analytics.
Despite growing expectations for a rate cut next week, Treasury yields rose on Monday following declines in Japanese and European government bonds after comments from Bank of Japan Governor Kazuo Ueda, who indicated that conditions were aligning for a potential rate hike.
10-year and 2-year Treasury yields climbed 1.9% and 1.1% respectively, finishing at 4.092% and 3.534%.
The move in yields weighed heavily on rate-sensitive S&P 500 sectors such as real estate and utilities.
Investors are now awaiting the conclusion of the Federal Reserve’s two-day policy meeting on 10 December. Markets have priced in an 87.4% probability of a 25 basis-point rate cut, according to the CME Group FedWatch Tool.
Wall Street is coming off a strong week, with the Dow and S&P 500 each advancing more than 3%, while the Nasdaq rallied nearly 5%.
