U.S. stock index futures steadied on Thursday evening following a weak start to 2025, triggered by losses in Apple and Tesla, two of Wall Street’s most prominent tech heavyweights. The mixed sentiment was further impacted by slower interest rate cuts expectations and the uncertainty surrounding policies under incoming President Donald Trump, although the major U.S. indexes are still sitting on strong gains for 2024.
Futures Activity
S&P 500 Futures: 5,917.75 points, steady.
Nasdaq 100 Futures: 21,171.75 points, steady.
Dow Jones Futures: 42,694.0 points, little change.
Apple and Tesla Slide Amid China and Delivery Woes
The losses in Apple and Tesla were significant drivers behind Wall Street’s weak performance on Thursday.
Apple Inc. (AAPL)
Apple saw a 2.6% decline during the session, marking a rough day for the tech giant. The drop was triggered by discounts of up to 500 yuan ($68.50) on its flagship devices in China, as it faces heightened competition and lagging sales in the region.
China has been a critical market for Apple, but the company’s sales there were weaker than expected in November. Analysts at UBS warned that Apple could miss its sales estimates for the December quarter.
Apple’s difficulties in China come amid intensifying competition from local players like Huawei and Xiaomi, who have made significant inroads in the smartphone market.
Tesla Inc. (TSLA)
Tesla fell 6.1% on Thursday after the company reported disappointing fourth-quarter deliveries, which missed analysts’ expectations.
The company faced weak demand in North America and Europe, alongside growing competition in China. The disappointing results marked Tesla’s first annual decline in deliveries in over a decade.
The weaker demand for electric vehicles (EVs) and shrinking margins are raising questions about Tesla’s ability to sustain its rapid growth. The company is increasingly looking to diversify its offerings into autonomous driving and artificial intelligence (AI) technologies.
Economic Data Dampens Investor Sentiment
Wall Street’s losses were also compounded by mixed economic data:
GDP Downgrade
The Atlanta Federal Reserve’s revision of its gross domestic product (GDP) estimates for the fourth quarter showed that the U.S. economy cooled further toward the end of 2024, adding pressure to investor sentiment. The downgrade reflected concerns about slower economic growth.
Jobless Claims Data
On a more positive note, weekly jobless claims came in lower than expected, indicating that the labor market remains strong despite broader economic uncertainties.
However, the data also raised concerns that the robust labor market could allow the Federal Reserve to slow down its interest rate cuts in 2025. The central bank had already signaled a slower pace of easing due to persistent inflation pressures.
Wall Street’s Weak Start to 2025
Despite the steadying futures on Thursday evening, Wall Street ended its first trading day of the year on a weak note:
- S&P 500: Fell 0.2%, closing at 5,896.60.
- NASDAQ Composite: Also declined by 0.2%, closing at 19,280.75.
- Dow Jones Industrial Average: Dropped 0.4%, closing at 42,392.27.
Outlook
While Apple and Tesla’s losses weighed heavily on the market, the broader economic backdrop presents a mixed picture. The slower-than-expected economic growth and the prospect of gradual interest rate cuts could keep the market in a cautious mood in the near term. However, Wall Street remains well-positioned from the strong gains of 2024, with investor focus turning to upcoming policy moves from the Federal Reserve and the transition to President Trump’s policies.
As investors digest this complex mix of data and sentiment, market volatility is likely to persist, especially with concerns over inflation, interest rate cuts, and global competition.
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