Traders work on the floor of the New York Stock Exchange on January 10, 2025 in New York City.
New York Stock Exchange
This report is from today's CNBC Daily Open, the international markets newsletter. CNBC Daily Open keeps investors informed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
The Nasdaq continues to lag other major indexes
the Standard & Poor's 500 and Dow Jones Industrial Average It rose on Tuesday, however Nasdaq Composite She blinked, making it On the second day he performed poorly. Asia Pacific markets Most of them fell on Wednesday. Japan Nikki 225 lost about 0.1% Reuters Tankan poll The month of January found the country's business sentiment rising.
South Korean President Yoon arrested
Yoon Suk-yeol, South Korea's president, was arrested on Wednesday By the country's Corruption Investigation Bureau to senior officials. The arrest was the first of its kind for a sitting South Korean leader, and the second attempt by the chief information officer after the president's security staff foiled the first. South Korean stocks reacted weakly to the news.
Implications of the global bond sale
A Selling is accelerating in global bond marketsAnalysts told CNBC that the reason behind this is the possibility of lower interest rates in the United States and higher government debt. Higher yields increase borrowing costs for governments and companies, which can lead to higher taxes and reduced corporate profits. The rise in US yields also puts pressure on other currencies and makes it difficult for global central banks to lower interest rates.
Meta cuts jobs while Microsoft freezes hiring
dead will be Laying off about 5% of its lowest performing employeesCNBC confirmed on Tuesday. CEO Mark Zuckerberg informed employees of the decision in a memo posted to the company's internal forum on Tuesday. Separately, Microsoft Plan to Pausing hiring for part of its consulting business In the United States, according to an internal memo.
The SEC files a lawsuit against Musk over his Twitter stock
The Securities and Exchange Commission filed a lawsuit against Elon Musk on Tuesday, according to the billionaire's lawsuit Committing securities fraud In 2022 by not disclosing that he had amassed an active stake in Twitter, a secret that allowed him to buy shares at “artificially low prices.”
(PRO) How One ETF Returned 80% in 2024
A little-known exchange-traded fund, managed by a company founded only in 2021, rose 80% in 2024. The ETF director explains The strategy behind this gainIt reveals the established companies and their weight in the fund.
Bottom line
The technology has not stopped beating the market yet.
The Nasdaq Composite lost 0.23%, underperforming the S&P 500 and Dow Jones Industrial Average — which rose 0.11% and 0.52%, respectively — for the second day in a row. All Magnificent Seven shares fell, with Meta, Tesla and Nvidia Recording the largest losses.
Adding to the sector's misery, the decline in technology stocks was accompanied by news of layoffs and hiring freezes.
In an effort to cut expenses, Microsoft will temporarily halt hiring in part of its consulting unit, cut travel expenses and cut marketing spending, according to an internal memo.
Meanwhile, Meta announced in an internal memo on Tuesday that it will exit approximately 5% of our low performers. (Just as one “goes out” of fact-checking or “goes in” on free speech, I suppose). Zuckerberg also warned employees that 2025 will be an “intense year.”
Zuckerberg's warning was directed at Meta, of course, but it may also apply to tech companies that are grappling with huge investments in AI, without necessarily having the revenue to justify such high spending.
As we enter the fourth quarter earnings season, there are signs of optimism in this year's business environment.
“We think earnings will be stronger,” said Jay Hatfield, founder of Infrastructure Capital Advisors.
“The economy is strong in the fourth quarter. Typically, companies learn if they have a problem by then, and they're probably going to be very optimistic about the future because the Trump administration is pro-business. So we think most CEOs are very optimistic about the outlook for 2025.”
Upbeat CEOs may be steering other sectors, as suggested by moves from investors, who moved from technology to utilities, financial services and materials on Tuesday.
Whether this sector rotation continues will depend on the Consumer Price Index, which will fall later today.
— CNBC's Lisa Kailai Han, Hakyung Kim and Brian Evans contributed to this report.
