Nasdaq falls 1% Monday following 5 straight weeks of gains: Live updates

Factory orders declined slightly more than expected in October, a sign of potential deceleration for the U.S. economy heading into the end of the year.

New orders for manufactured goods fell 3.6% on the month, 0.1 percentage point more than the Dow Jones estimate and a reversal from the downwardly revised 2.3% increase in September, the Commerce Department reported Monday.

Excluding transportation, orders were off 1.2% and fell 4.2% excluding defense. Orders for longer-lasting durable goods slid 5.4%.

—Jeff Cox

The three major indexes opened Monday’s trading session down.

The Dow fell nearly 0.5%. The S&P 500 slipped 0.8%, while the Nasdaq Composite lost around 1%,

— Alex Harring

The inverse correlation between the S&P 500‘s performance and the movement in the 10-year Treasury yield has been the strongest in more than 20 years, according to Trivariate Research founder Adam Parker. He believes the fall in the 10-year yield over the past few weeks has fueled the recent rise in equities.

“Some investors feel encouraged about the broadening of the rally and believe that is a proxy for better things to come. We are not convinced,” Parker wrote in a Monday note.

He added that lower yields have boosted small caps and value stocks in November. Both groups have previously struggled when rates pushed higher. The Russell 2000, the benchmark for small cap companies, rallied 8.8% in November and broke a 3-month losing streak. November marked the best month for the small cap index since Jan. 2023, when it rose nearly 9.7%.

“Lower yields mean those companies with poorer balance sheets have lower cost of capital, less interest expense, and a greater probability of resiliency in a downturn. It is simply about loosening financial conditions,” Parker said.

— Hakyung Kim

Check out the companies making headlines before the bell:

• Coinbase — Crypto-related assets surged after Bitcoin topped $40,000 for the first time this year. Coinbase jumped 7%, MicroStrategy gained 7% and Marathon Digital climbed 13%.
• Uber Technologies — The ride-hailing stock rose 4% after S&P Dow Jones Indices on Friday said it will enter the S&P 500, along with Jabil and Builders FirstSource. The three will replace Sealed Air, Alaska Air Group and SolarEdge Technologies. Shares of Jabil and Builders FirstSource were each higher by more than 2%.
• General Motors — Shares of the Cadillac and Chevrolet maker added 1.3% after an upgrade from Mizuho Securities, which said GM has bottomed and is poised for growth, particularly after the labor settlement with the United Auto Workers.

Read the full list here.

— Sarah Min

As investors gear up for Monday’s session, they’re looking to build on the gains seen during yet another positive trading week.

The Dow led the way last week, adding 2.4%. Meanwhile, the S&P 500 and Nasdaq Composite finished the week higher by 0.8% and 0.4%, respectively.

It marked the fifth straight winning week for each of the three major indexes. Notably, it was the first weekly win streak of that length since 2021 for the blue-chip Dow.

— Alex Harring

Stocks connected to bitcoin rallied in premarket trading as the digital currency topped $40,000.

Marathon Digital popped more than 13% before the bell, while Riot Platforms jumped more than 10%. Coinbase and MicroStrategy both advanced more than 6%.

The leg up comes as the cryptocurrency notched a 19-month high. Optimism stemmed from the potential for a bitcoin-focused exchange-traded fund and expectations that the Federal Reserve could cut interest rates.

— Alex Harring

Spotify rose more than 1% in Monday premarket trading after the music streaming platform announced it was laying off 17% of its workforce.

The latest round of cuts amounts to around 1,500 roles, a source familiar told CNBC. CEO Daniel Ek said in an email to staff that the company took on too many employees in 2020 and 2021.

Shares have surged more than 125% in 2023, regaining some ground after falling more than 25% and 66% and in 2021 and 2022, respectively.

— Alex Harring

Bitcoin topped $40,000, a new high for the year as investors get bullish ahead of possible U.S. approval bitcoin exchange-traded fund and as traders bet the Federal Reserve will begin cutting rates next year.

Bitcoin was last up by 6% to about $42,000. The cryptocurrency is now up more than 150% this year.

-John Melloy

The pan-European Stoxx 600 hovered just below the flatline in early trade, with mining stocks shedding 1.5% to lead loses while retail stocks added 0.8%.

Veteran investor David Roche said Monday he was “very worried” about the amount of global debt, but reassured that it would not be a top crisis this year as inflation continues to ebb.

There’s a mismatch in the rate at which debt is increasing and our capacity to pay for it, warned Roche.

He said he is certain that mounting debt will be a major crisis, but not the top crisis of the year as interest rates continue to fall.

“Interest rates will be on the way down rather than up and that will save us all again to fight another day,” he said on CNBC’s “Squawk Box Asia” on Monday.

Global debt increased by $10 trillion in the first half of 2023, bringing it to a record high of $307 trillion.

— Charmaine Jacob

Spot gold prices notched a new record on Monday for a second straight day, rising to a high of $2,110.8 per ounce before giving up some gains. It is currently trading at $2,084.28.

Analysts who spoke to CNBC noted that the yellow metal’s price is on course to hit fresh highs next year, citing geopolitical uncertainty, a likely weaker U.S. dollar and possible interest rate cuts.

“The anticipated retreat in both the USD and interest rates across 2024 are key positive drivers for gold,” said Heng Koon How, UOB’s head of markets strategy, global economics and markets research, who expects gold prices could reach up to $2,200 by the end of 2024.

Read more here.

— Lee Ying Shan

Shares of Evergrande Group rose over 9% as the beleaguered Chinese property firm’s court hearing over its possible liquidation was postponed to Jan. 29, 2024.

The firm was originally scheduled to face a Hong Kong court hearing on Monday over a petition from a creditor seeking to wind up the company.

Over the weekend, GMT Research issued a report alleging that the company had inflated its revenue for a decade, and that the it was never profitable, which Evergrande refuted.

Read the full story here.

— Lim Hui Jie

December has a long track record of posting solid gains for equities. The S&P 500 has historically posted gains 72.6% of the time, according to Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.

December has also historically been the best of any month, with an average gain of 2.97% for the up months, a 3.19% average decrease for the down months and an overall average gain of 1.28%, according to the analyst.

— Yun Li

Market pricing indicated a more than 70% chance of a rate cut starting March next year, according to the CME FedWatch Tool. Moreover, futures are pointing to cuts totaling 1.25 percentage points by the end of the year, the equivalent of five quarter percentage point reductions.

The Fed’s next meeting and last of the year is Dec. 12-13. The central bank enacted a series of 11 interest rate hikes, taking its policy rate to the highest in 22 years at a target range between 5.25%-5.5%.

— Yun Li