Wall Street Dips As Crypto, AI Stocks Slide/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Wall Street opened lower Monday, as slumping crypto and tech stocks, including Bitcoin and Nvidia, pulled major indexes down. The S&P 500 and Dow Jones fell 0.6%, threatening to break a five-day win streak. Rising bond yields and global rate hike speculation also pressured investor sentiment.
Wall Street Market Dip Quick Looks
- S&P 500 and Dow both down 0.6% to start the week.
- Bitcoin plunged below $86,000, down 5% in 24 hours.
- Crypto-related stocks like Coinbase and Robinhood fell sharply.
- Nvidia, Palantir, and other AI stocks also retreated.
- U.S. Treasury yields rose amid global rate hike concerns.
- Bank of Japan hints at rate hike, pushing bond yields up.
- Higher bond yields reduce appetite for riskier investments.
- Synopsys gained 4.6% after Nvidia’s $2B investment announcement.
- Black Friday and Cyber Monday sales beat expectations, but offered limited stock market boost.
- European and Asian markets mixed, with Japan’s Nikkei 225 down 1.9%.
Deep Look
Crypto Slide, Rising Yields Knock Wall Street Off Winning Path
NEW YORK — Wall Street began December on a weaker note, as key stock indexes slipped Monday following a sharp sell-off in crypto and tech shares. The drop threatens to end the market’s five-day winning streak, which had been fueled by optimism over potential Federal Reserve interest rate cuts.
As of early Monday, the S&P 500 fell 0.6%, with the Dow Jones Industrial Average down 267 points (0.6%), and the tech-heavy Nasdaq Composite declining 0.8%.
Investor enthusiasm from last week, driven by hopes the Federal Reserve will lower rates in the near future, has been tempered by a global surge in bond yields and renewed volatility in digital assets and high-growth tech stocks.
Crypto Leads Market Decline
Bitcoin, once flying high near $125,000 in October, fell sharply to below $86,000—down roughly 5% in a single day. The pullback triggered a domino effect in crypto-related equities.
- Coinbase Global dropped 4.8%.
- Robinhood Markets fell 4.5%.
- Strategy (formerly MicroStrategy)—a firm largely dedicated to bitcoin accumulation—tumbled 6.9%.
As cryptocurrencies continue to act like high-risk assets, their value tends to decline when interest rates or bond yields rise, which seems to be the case as global markets brace for potential central bank actions.
Tech and AI Stocks Also Feel Pressure
The sell-off wasn’t limited to crypto. Technology giants that have driven much of this year’s gains also saw red:
- Nvidia, one of Wall Street’s most influential stocks and a key player in the AI boom, dipped 0.6%.
- Palantir Technologies shed 2.3%.
- Super Micro Computer, another AI darling, declined 3%.
Despite strong earnings earlier in the year, these stocks are particularly sensitive to bond yields, given their elevated valuations and reliance on future growth expectations.
Bond Market Jitters After Global Rate Speculation
Adding to the market’s unease, yields on long-term U.S. Treasurys rose Monday. The 10-year Treasury yield increased to 4.08%, up from 4.02% on Friday.
This surge came amid speculation that the Bank of Japan may raise interest rates—something it hasn’t done in years. Its benchmark rate has hovered near zero, but persistent inflation above its 2% target has prompted reconsideration. This global shift in rate expectations has made bond investments more attractive, diverting capital from riskier assets like equities and cryptocurrencies.
Higher bond yields often weigh heavily on stock prices, particularly in tech and growth sectors. They also increase borrowing costs for businesses and consumers, dampening future spending and investment.
Holiday Retail Data Not Enough to Reassure Markets
Although Black Friday and Cyber Monday sales appeared strong—exceeding early forecasts—investors remained focused on macroeconomic signals rather than short-term retail wins.
Analysts had hoped robust consumer spending would help boost market sentiment, but the data failed to lift major indexes. The economic backdrop, including high interest rates, global trade tensions, and uncertain employment conditions, continues to dominate market narratives.
Bright Spot: Synopsys Rises on Nvidia Partnership
One of the few gainers was Synopsys, which rose 4.6% after announcing a $2 billion investment from Nvidia as part of an expanded strategic partnership. The deal is seen as a signal of Nvidia’s long-term commitment to AI infrastructure and semiconductor design innovation.
However, Synopsys’ gain wasn’t enough to offset broader weakness across the tech sector.
Global Markets Mixed
Overseas, global markets sent mixed signals:
- France’s CAC 40 fell 0.5%, dragged by a 5.1% decline in Airbus shares after the company revealed a software glitch affecting its A320 jets. The issue caused some delays as airlines scrambled to update systems ahead of the busy travel weekend.
- Japan’s Nikkei 225 slid 1.9% as investor concerns grew over the Bank of Japan’s rate stance shift. A move away from ultra-loose monetary policy could mark a significant pivot for one of the world’s most accommodative central banks.
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