The initial days of 2024 saw Wall Street falter, with the S&P 500 experiencing its most significant two-day downturn since late October, as investors cashed in on profits following last year’s robust rally.
The surge in late 2023 was largely fueled by expectations that the Federal Reserve might begin reducing interest rates this year.
Market traders currently assign a 72.6% likelihood of at least a 25 basis point reduction in rates by March, with the probability almost reaching 96% for May.
Yields on US Treasury bonds have slightly increased, reflecting changing expectations for interest rates, with the yield on the benchmark 10-year note rising to 3.96%.
Investors are now looking forward to the ADP National Employment Report, scheduled for 1.15 pm UK time, before a crucial employment report on Friday. These reports are expected to provide insights into the state of the labour market.
In premarket activity, the Dow Jones Industrial Average, S&P 500, and Nasdaq 100 all showed modest gains of around 0.1%.
