On Tuesday Eastern Time, the three major US stock indices collectively closed lower, following a series of optimistic economic data indicating that the US job market seems to be stabilizing and there is a possibility of inflation rising again, which severely dampened expectations for the Federal Reserve to cut interest rates.

The US Bureau of Labor Statistics released the Job Openings and Labor Turnover Survey (JOLTS) report, showing that driven by significant growth in the Business Services Sector, job vacancies in the US increased to a six-month high in November. Specifically, the number of vacant positions rose from October's revised figure of 7.8 million to 8.1 million, exceeding all analysts' expectations.

Another dataset indicated that US service sector activity accelerated in December, reflecting enhanced business activity. However, an index measuring input prices soared to a nearly two-year high, indicating rising inflation, which aligns with the Fed's forecast of smaller interest rate cuts this year.

Joe Mazzola, a trading and derivatives strategist at Charles Schwab, stated: "The market may have previously thought the process of combating inflation was nearing its end, but it now appears that this issue will persist for a longer time, and rates will remain at a high level."

After data showed a strong economy, the benchmark 10-year US Treasury yield reached an eight-month high of 4.677%, which also pressured the trend of risk assets.

Due to the continued resilience of the economy, expectations for the Federal Reserve's first interest rate cut this year have been pushed back. According to CME Group's FedWatch tool, traders now believe that the Fed's next rate cut is more likely to occur in June, followed by maintaining rates unchanged for the remainder of the year.

Atlanta Fed President Bostic stated that given the uneven progress in reducing inflation, officials should be cautious in their decision-making and prefer to keep rates at a high level.

Investors are also concerned about the potential impact of tariffs imposed by the incoming Trump administration on Consumer prices, as these tariffs could intensify inflationary pressures and affect the Federal Reserve's monetary policy decisions.

Dan Niles, the founder of Niles Investment Management, appears particularly cautious in his latest forecast. He expects a significant decline in the stock market and lists Cash as his preferred investment symbol for 2025. "My biggest concern is that inflation may resurge by the end of 2025, prompting the Federal Reserve to raise interest rates due to strong consumer spending in the USA and a growth-oriented fiscal policy, which could lead to a 20% drop in US stocks."

Market Dynamics

By the close, the Dow Jones Industrial Average fell by 178.20 points, or 0.42%, to 42,528.36 points; the Nasdaq dropped 375.30 points, or 1.89%, to 19,489.68 points; the S&P 500 Index decreased by 66.35 points, or 1.11%, to 5,909.03 points.

Most US stock Industry ETFs closed lower, with the Penghua Guozheng Semiconductor Chip ETF down 2.38%, the global Technology stocks Index ETF falling 2.21%, the Technology Industry ETF, Consumer Discretionary ETF, and Internet stocks Index ETF declining between 1.99% and 1.56%, while the global Aviation Industry ETF rose 0.74%, the Biotechnology Index ETF increased by 0.88%, and the Energy sector ETF was up 1%.

Most of the 11 sectors of the S&P 500 Index declined, with the Consumer Staples Sector down 0.27%, the Communications Services Sector falling 1.05%, the Financial Sector down 0.15%, the Medical Care Sector up 0.58%, and the Information Technology Sector down 2.39%.

Performance of Popular Stocks

The seven major US stocks all fell, with NVIDIA down 6.22%, Tesla falling 4%, Amazon decreasing by 2.42%, Meta down 1.95%, Microsoft dropping 1.28%, and Google A down 0.7%.

The Nasdaq China Golden Dragon Index fell by 0.2%, with China Concept Stocks showing mixed results. Xpeng Motors rose nearly 10%, MINISO increased over 5%, Bilibili climbed over 2%, while PDD Holdings and iQIYI rose over 1%; NIO dropped over 4%, and Alibaba and Tencent Music fell over 1%.

Vaccine stocks surged, with Moderna rising nearly 12% and Novavax increasing almost 11%. The day before, the USA reported its first human death from Bird Flu.

Johnson & Johnson rose 1.8%, as research shows its combination therapy for lung cancer outperformed AstraZeneca's best-selling drug Tagrisso, a finding that could change the treatment standards for one of the deadliest tumor types.

Bitcoin fell below 0.097 million USD, and concepts related to Cryptos experienced widespread declines, with "Bitcoin Hold Positions" MicroStrategy dropping nearly 10%, Coinbase falling over 8%, and MARA Holdings dropping over 7%.

Company news

[Two Global Data Rights Giants Announce Merger with Stock Prices Soaring]

On local time Tuesday, two global giants in visual content copyright. $Getty Images (GETY.US)$ and $Shutterstock (SSTK.US)$ Officially announced the final merger agreement, leading to a significant rise in the stock prices of both listed companies.

According to the announcement, the merged new company is named "Getty Images Holdings" and will continue to trade under the stock code "GETY" on the NYSE. At the end of the trade, the old shareholders of Getty Images will hold 54.7% of the new company's shares, and the remaining 45.3% will belong to the existing shareholders of Shutterstock. After the transaction is completed, Mark Getty, the chairman of Getty Images' Board of Directors, and Craig Peters, the CEO, will continue to hold the same positions in the new company. Shutterstock will gain 4 seats on the 11-member board.

[Tesla's Self-Driving Car Summon Feature Faces Investigation by US Authorities]

Due to concerns, $Tesla (TSLA.US)$ The newly released driving assistance feature may lead to collisions, and US regulators may investigate the company's technology. Following reports of issues with Tesla's feature called "Smart Summon," the National Highway Traffic Safety Administration (NHTSA) has begun an initial assessment of approximately 2.6 million Tesla vehicles.

According to documents released on NHTSA's official website, the department received a complaint claiming that Tesla's "Smart Summon" feature caused a car accident, alongside at least three similar incidents reported in the media. The "Smart Summon" feature, launched by Tesla at the end of last year, allows owners to remotely move their vehicles using a smartphone app in parking lots or other locations. NHTSA stated that some vehicles failed to detect barriers or other parked cars when using the feature, leading to accidents, and some users were unable to avoid collisions due to time constraints.

JPMorgan plans to require all employees to work in the office five days a week.

$JPMorgan (JPM.US)$ The company is preparing to notify all employees to work in the office five days a week, ending the hybrid work options for thousands of employees and restoring the attendance policy from before the pandemic. According to informed sources, JPMorgan is expected to announce this change in the coming weeks, replacing the current requirement for many employees to work three days in the office. This change indicates that the company CEO Jamie Dimon remains firm in his belief that employees can better collaborate when they are working face-to-face. Dimon has previously criticized the federal government for not requiring employees to come into the office more frequently.

XPeng Aeroht: Flying cars will be produced in mass by 2026.

At the ongoing CES 2025, XPeng Aeroht showcased its split flying car 'Land Carrier'. According to XPeng Aeroht officials, the construction of its flying car manufacturing base is currently underway, which is the first flying car factory in the world to utilize a modern assembly line for large-scale production. This facility will be used to produce the aircraft components of the split flying car 'Land Carrier', with an annual production capacity planned for 0.01 million units, and is expected to be completed in the third quarter of next year, with flying cars set for mass production and delivery in 2026.

NVIDIA launches personal computing product Project DIGITS.

At the ongoing CES 2025, $NVIDIA (NVDA.US)$ Founder and CEO Jensen Huang announced the launch of a brand new personal computing product, Project DIGITS. It is reported that Project DIGITS is equipped with NVIDIA's GB10 super chip, providing one trillion AI computing performance, supporting the prototyping, fine-tuning, and operation of AI large models. Through Project DIGITS, users can develop and run model inference using their own desktop systems and then seamlessly deploy models on accelerated cloud or datacenter infrastructure.

Editor/rice