U.S. stocks closed lower on Monday, with investors continuing to dump artificial intelligence (AI) stocks as they looked forward to a batch of fresh economic data scheduled for release this week. All three major indexes ended in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) declined 0.1% or 41.49 points, to finish at 48,416.56 points.
The S&P 500 slid 0.2%, or 10.90 points, to end at 6,816.51 points. Tech stocks were the worst performers, while healthcare stocks were the biggest gainers.
The Information Technology Select Sector SPDR (XLK) declined 1%, while the Healthcare Select Sector SPDR (XLV) gained 1.3%. Eight of the 11 sectors of the benchmark index ended in positive territory.
The tech-heavy Nasdaq tumbled 0.6%, or 137.76 points, to close at 23,057.41 points.
The fear gauge, CBOE Volatility Index (VIX), was up 4.83% to 16.50. Decliners equaled advancers on the NYSE by a 1-to-1 ratio. On the Nasdaq, a 1.76-to-1 ratio favored declining issues. A total of 17.13 billion shares were traded on Monday, higher than the last 20-session average of 17.10 billion.
On the Nasdaq, there were 1,715 new 52-week highs and 3,021 new lows. On the NYSE, there were 283 new 52-week highs and 93 new lows.
Investors Dump Tech Stocks
Tech stocks continued to suffer on Monday after taking a hit in the previous session that saw the S&P 500 and the Nasdaq recording their steepest daily declines in more than three weeks. Concerns over high inflation and debt-fueled investments in AI have been worrying investors lately.
Investors who were, till some time back, bullish about the potential of AI stocks have lately been concerned about the profitability of the ongoing surge in AI investments. On Monday, tech stocks came under pressure once again, with investors shifting focus to areas that are more sensitive to the economy.
AI-focused stocks like Broadcom, Inc. (AVGO) and Oracle Corporation (ORCL) weighed on the broader market on Monday. Shares of Broadcom and Oracle declined 5.6% and 2.7%, respectively, on Monday.
Monday’s declines came after Broadcom ended more than 7% lower last week, while Oracle declined 12.7%. Broadcom has a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Investors Await Economic Data
Investors are also looking forward to a slew of economic reports set to be released this week, which could set the tone for the markets. On Tuesday, investors will finally get to set the long-overdue November nonfarm payrolls data.
Also, the retail sales figures for October will be out before the bell on Tuesday. Both the key reports got delayed because of the government shutdown.
This is the last full trading week of the year, and the fresh batch of economic data is likely to help investors assess the tone of the markets for the first few weeks of next year.
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Oracle Corporation (ORCL): Free Stock Analysis Report Broadcom Inc. (AVGO): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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