U.S. stocks fall from new highs, with the three major indices declining at the Monday open, while gold and crude oil are strengthening.

U.S. stocks just hit a record high last Friday, but opened lower on Monday. On January 12th (Monday) at the open, the Dow Jones Industrial Average fell 311.56 points to 49,192.51, the S&P 500 declined 33.63 points to 6,932.65, and the Nasdaq Composite dropped 76.69 points to 23,594.66. Notably, while the stock market was declining, spot gold hit a record high, and crude oil futures also strengthened. This asset rotation reflects subtle shifts in market sentiment.

From New Highs to Decline: The Turning Point

The comparison before and after is clear

Last Friday, the three major U.S. stock indices celebrated a new all-time high, but by Monday’s open, a clear pullback had occurred. Although the declines seem modest (ranging from 0.3% to 0.63%), the shift from new highs to a downturn is noteworthy in itself.

The implications behind the difference in decline percentages

The varying declines among the three indices reflect different sector pressures:

• Dow Jones (largest decline at 0.63%): Indicates pressure on large-cap blue-chip and traditional industrial stocks, which are most sensitive to economic fundamentals.
• S&P 500 (second at 0.48%): As a broader market indicator, its decline is intermediate.
• Nasdaq (smallest at 0.32%): Technology stocks are relatively resilient, possibly due to long-term optimism about the tech sector.

Possible Reasons for the Market Sentiment Shift

Based on recent news, several factors may have contributed to this turn:

The dual impact of employment data

Last Friday’s employment report was mixed—only 50,000 new non-farm jobs were added, well below the expected 73,000, but the unemployment rate fell to 4.4%. This contradictory data may have caused market doubts: does slowing job growth signal weakening economic momentum?

Rotation from risk assets to safe-haven assets

The most convincing signals are from other asset classes:

• Spot gold hitting a record high: at $4,550.880 per ounce, up 0.93%. Gold’s rise as a safe-haven asset generally indicates market seeking protection.
• Crude oil futures up over 2%: mainly driven by tensions with Iran, but also reflecting rising geopolitical risks.

When stocks fall while gold and oil rise, it often signals investors are reassessing risks.

The stabilizing role of Treasury yields

Treasury yields remain steady at around 4.17%, providing a relatively calm backdrop for stocks and cryptocurrencies. However, this also means there are no new interest rate signals to stimulate the market upward.

Personal Perspective

From a technical standpoint, this correction may simply be a normal profit-taking after new highs. But from a sentiment perspective, the market seems to be reassessing economic outlook—slowing job growth combined with rising geopolitical risks is enough to temporarily reduce risk appetite among investors.

Next Key Focus

Upcoming points to watch include:

• This week’s economic data: Will it continue to support or undermine market confidence?
• Geopolitical developments: How will tensions with Iran evolve, and will they further push up oil prices?
• Gold performance: If gold continues to hit new highs, safe-haven sentiment may remain strong.
• Tech sector trends: Can Nasdaq’s resilience persist, or will it follow the broader decline?

Summary

U.S. stocks declined slightly at the open after reaching record highs last Friday. Although the decline is limited, the shift itself is noteworthy. Gold hitting a record high and oil rising over 2% while stocks fall signals asset rotation and risk reassessment. Slowing job growth and geopolitical tensions are the main factors weighing on equities. In the short term, this may be profit-taking, but mid-term, economic data and geopolitical risks could further impact market confidence.