Wall Street’s main indexes ended lower on Monday, kicking off the final week of the year on a softer note, as heavyweight technology stocks retreated from last week’s gains that had pushed the S&P 500 to record highs. Canada’s main stock index also closed lower, under pressure from a significant drop in precious metals prices.
The information technology sector weighed on the S&P 500, as most tech and AI-linked stocks declined. Nvidia slipped 1.2% and Palantir Technologies dropped 2.4%.
The S&P 500 lost 24.20 points, or 0.35%, to 6,905.74 and the Nasdaq Composite lost 118.75 points, or 0.50%, to 23,474.35. The Dow Jones Industrial Average fell 249.04 points, or 0.51%, to 48,461.93. Tesla fell 3.3% after hitting a record high last week, weighing on the consumer discretionary sector.
The S&P/TSX Composite index closed down 103.17 points, or 0.32%, at 31,896.59. However, the benchmark was poised for a gain of about 2% in December, marking its eighth consecutive monthly gain — a streak not witnessed since 2014.
Mining shares led Monday’s losses, giving back some of their yearly gains as the TSX materials sector fell nearly 3%.
Gold prices slipped 4.6%, while silver slid 9.5% after touching a record peak above US$80 an ounce earlier in the session as investors booked profits amid perceptions of easing geopolitical tensions, which reduced safe-haven buying.
Shares of Kinross Gold were down 3.6%, while those of Agnico Eagle fell 5.3% and Barrick Mining fell 2.8%. Endeavour Silver closed down 1.9% and Silvercorp Metals fell 3.4%.
Mining and financial shares have driven TSX’s gains this year, lifting the index to a third consecutive annual gain and its strongest performance since 2009, with a 29% rise.
Shiraz Ahmed, founder and CEO of Sartorial Wealth, said while he expects some moderation from the current “stunning levels”, the metals rally is not over yet.
“I think the TSX had a bit of an outlier year. I am not expecting the kind of year that we had this year to happen over and over again. This was an anomaly, frankly, the best year we’ve seen in at least the last decade.”
Capping the decline, energy shares gained, tracking oil prices that rose about 2% higher as investors weighed Ukrainian peace talks against potential oil supply disruption in the Middle East.
Stocks pulled back after the S&P 500 was within 1% of the 7,000-point mark. The blue-chip Dow hit a record closing high last week. Some investors were hoping for a “Santa Claus rally”, a seasonal phenomenon where the S&P 500 typically posts gains in the last five trading days of the year and the first two in January, according to Stock Trader’s Almanac.
All three U.S. indexes were headed for firm monthly gains, with the Dow and S&P 500 on pace for their eighth consecutive month in the green. The bull market, which began in October 2022, stayed intact despite concerns over high valuations of technology companies and market volatility. With traders still optimistic about AI, interest-rate cuts and a resilient economy, all three main indexes are set for their third consecutive yearly gain. Most strategists also expected gains in 2026.
With expectations for continued global economic expansion and further easing by the Federal Reserve, it would be unusual to see a significant equity setback or bear market without a recession, said Peter Oppenheimer, chief global equities strategist at Goldman Sachs, in a recent note.
On the macro front, minutes from the Fed’s previous meeting and a weekly reading of jobless claims will be on the radar in an otherwise data-light week.
The S&P 500 has added about 17% so far this year, as the frenzy to capitalize on AI helped the U.S. benchmark overtake Europe’s STOXX 600, despite investors diversifying away from U.S. stocks earlier in the year.
Among U.S. stock moves, DigitalBridge surged 9.6%, with Japan’s SoftBank Group set to acquire the digital infrastructure investor in a deal valued at $4 billion.
Reuters, Globe staff