Tech Giants Drag the Market Lower as U.S. Stocks Post First Back-to-Back Declines of 2026

Market Overview

On Wednesday, all three major U.S. equity indices recorded their first consecutive losses of 2026. The Nasdaq Composite fell 1%, marking its steepest decline in nearly a month, as heavyweight stocks came under broad pressure.

The so-called “Magnificent Seven” all closed lower, a rare synchronized pullback, with Microsoft, Amazon, and Meta each dropping more than 2%. Semiconductor stocks also weakened, with Broadcom sliding over 4%.

Financials failed to provide support despite earnings beats from major banks such as Wells Fargo and Bank of America, as profit-taking dominated sector performance.

On the macro and FX front, rising risk aversion drove demand for safe-haven assets, pushing U.S. Treasury prices higher and sending the 10-year yield to its lowest level in a week. The U.S. Dollar Index pared earlier gains and turned lower.

The Japanese yen rebounded after Japan‘s finance minister warned that currency intervention remained an option, following the yen’s slide to an 18-month low. Offshore RMB remained stable, briefly reclaiaming the 6.97 level intraday.

Cryptocurrencies extended their rally, with Bitcoin surging above USD 97,000 at one point, reaching a two-month high.

Commodities: An Extremely Divergent and Volatile Session

Metals “Grand Slam” Rally:

Gold, silver, copper, and tin all hit record highs intraday. Spot gold extended its record-setting run for a third consecutive session, while silver futures surged nearly 8%.

London tin spiked as much as 11%, driven by strong Chinese demand and rising AI-related welding applications. LME copper closed above USD 13,000 per ton for the first time on record, while nickel climbed to a fresh 18-month high.

Crude Oil Reversal:

Oil prices initially rose as much as 2% during the session, but reversed sharply after U.S. President Donald Trump commented on the Iran situation, stating that “we need to wait and see” and referencing “positive statements” received. Markets interpreted the remarks as a signal of easing geopolitical tensions, triggering a swift selloff that sent oil prices down more than 3% at one point.

Key Themes Ahead● U.S. November Retail Sales Surprise to the Upside

U.S. retail sales rose 0.6% month-over-month in November, exceeding market expectations of 0.5%.

Out of 13 major categories, 10 recorded monthly gains, led by a notable rebound in auto sales. Gas stations, sporting goods, and apparel also posted solid increases, underscoring the strong boost from holiday-season promotions.

Overall, consumer data continues to demonstrate resilience, reinforcing optimistic expectations for Q4 GDP growth.

● Supreme Court Decision Delayed Again

The U.S. Supreme Court did not issue a ruling on Wednesday regarding challenges to President Trumps tariff policies. This delay means global markets may need to wait at least another week to determine the fate of this landmark economic policy.

While the Court has not announced a specific date for the next ruling, additional decisions could be released on Tuesday or Wednesday, when the justices reconvene.

Key Events to Watch

21:30 (US)

• Initial Jobless Claims (week ending Jan 10)

• January New York Fed Manufacturing Index

• January Philadelphia Fed Manufacturing Index

• November Import Price Index (MoM)

22:15 (US)

• Federal Reserve Governor Michael Barr participates in a panel discussion on stablecoins

Overnight

02:30 (US)

• 2028 FOMC voter and Kansas City Fed President Jeffrey Schmid speaks on monetary policy and the economic outlook