U.S. FOMC Concerns Lead to Decline... Tesla Hits Record High [New York Stock Market Briefing]

Dow Jones Falls for 9th Consecutive Day... Longest Since 1978

NVIDIA Enters Correction Phase... Broadcom Down Over 3%

Major indices on the New York Stock Exchange closed lower across the board. This seems to be due to heightened caution among investors ahead of the U.S. Federal Reserve's (Fed) final monetary policy decision of the year.

Leading AI stock NVIDIA has entered a correction phase, falling to its lowest level since early October. Meanwhile, U.S. electric vehicle company Tesla continues to hit record highs.

On the 17th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 43,449.90, down 267.58 points (0.61%) from the previous session. The Standard & Poor's (S&P) 500 Index fell 23.47 points (0.39%) to 6,050.61, while the tech-heavy Nasdaq Composite Index dropped 64.83 points (0.32%) to 21,109.06.

The Dow Jones broke the 45,000 mark for the first time ever on the 4th but has fallen for nine consecutive trading days since the 5th, marking the longest decline since 1978.

On this day, big tech companies like Apple, Alphabet (Google's parent company), and Tesla once again hit all-time highs during the session but failed to lift the overall market.

Tesla rose 3.64% to $479.86, continuing its record-breaking streak for the third consecutive trading day. Apple climbed to $253.48, and Alphabet hit $201.42 before retreating.

Among the 'Magnificent 7 (M7),' Microsoft, Apple, and Tesla rose, while NVIDIA, Alphabet, Amazon, and Meta (Facebook's parent company) fell.

NVIDIA fell 1.22% to $130.39, marking its lowest closing price since October 7th ($127.72) and its fourth consecutive day of decline. Analysts suggest that NVIDIA's inclusion in the Dow Jones components since the 8th of last month contributed to the Dow's record decline.

Broadcom, which led the Nasdaq's rise the previous day, fell 3.91% on this day. The semiconductor design company Broadcom surpassed a market capitalization of $1 trillion for the first time since its listing on the 13th.

Quantum Computing, a quantum computing company, soared 51.53% to a record high on news of a major contract with NASA and the Goddard Space Flight Center.

Major pharmaceutical company Pfizer jumped 4.63% after announcing 2025 guidance that met Wall Street expectations.

Drone manufacturer Red Cat, which enjoyed a sharp rise in stock price over the past two trading days, fell 7.46% after reporting a loss of 18 cents per share.

Economic media CNBC analyzed the recent decline in the Dow Jones, stating, "After President Donald Trump won the election this year, there is a return to tech stocks from traditional blue-chip and old economy stocks that had surged."

New economic indicators released on this day suggested the robustness of the U.S. economy, further fueling inflation concerns.

The U.S. Department of Commerce reported that November retail sales increased by 0.7% from the previous month, totaling $724.6 billion. This represents a 3.8% increase from the same period last year, confirming the solid growth in consumption.

Chris Larkin, head of trading and investing at Morgan Stanley E-Trade, said, "The U.S. economy continues to deliver 'upside surprises,'" adding, "While the Fed is expected to cut rates by 0.25 percentage points the day after, if strong economic data continues to emerge, there is a high possibility that rate cuts will be halted in January next year."

The Fed will hold its last regular Federal Open Market Committee (FOMC) meeting of the year over two days starting today. According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the probability of the Fed cutting the policy rate by 0.25 percentage points this month is 95.4%, while the probability of holding it steady at the current level (4.50~4.75%) is 4.6%.

Investors are focused on the Fed's economic outlook and next year's dot plot to find clues about the direction of interest rates from next year to 2026. The CME FedWatch Tool suggested a 16.3% probability that the Fed will cut the policy rate by another 0.25 percentage points in January next year, following this month.

Meanwhile, the Volatility Index (VIX), compiled by the Chicago Board Options Exchange (Cboe), recorded 15.87, up 1.18 points (8.03%) from the previous session.

Jong-Sam Ko, Hankyung.com reporter jsk@hankyung.com