- The S&P 500 stock index falls 0.56%, trading above 5.865 at the time of writing.
- Tesla (TSLA) stock extends losses and plummets 6.08% today.
- General Motors (GM) shares lose 3.57% today, currently trading above $51.37.
The S&P 500 reacted lower from a daily high of 5,942, where it attracted sellers that dragged the index to a two-week low of 5,825. Currently, the S&P 500 trades at 5,865, falling 0.56% on the first trading day of the year.
Tesla and General Motors lead losses in the S&P 500
The electric car company Tesla (TSLA) records a daily drop of 6.08% in its share price after announcing that it delivered 1,789,226 vehicles worldwide during 2024, compared to 1,808,581 in the previous year. 2023. The company had a slight annual decrease in its sales, enough for investors to punish its securities, taking them to minimums not seen since December 6 in $378.28.
In the same vein, General Motors (GM) shares lost 3.57% today, signing their third consecutive session down and reaching the lows of December 20 at $51.02.
On the other hand, weekly applications for unemployment benefits stood at 211,000, improving the 222,000 estimated by the consensus. Investors will now focus on the ISM manufacturing PMI for December, where analysts expect it to be at 48.4 units, equaling the November record.
Levels to consider in the S&P 500
The S&P 500 formed short-term resistance given today’s high at 5,942. The next key resistance area is seen at 6,021, the December 27 high. To the south, the important support area is at 5,799, the December 20 pivot point.
S&P 500 4-hour chart
S&P 500 FAQs
The S&P 500 is a widely followed stock index that measures the performance of 500 public companies and is considered a broad measure of the US stock market. The influence of each company in the calculation of the index is weighted based on market capitalization. This is calculated by multiplying the number of listed shares of the company by the share price. The S&P 500 Index has achieved impressive returns: $1.00 invested in 1970 would have produced a return of almost $192.00 in 2022. The average annual return since its inception in 1957 has been 11.9%.
Companies are selected by committee, unlike other indices where they are included based on established standards. Still, they must meet certain eligibility criteria, the most important of which is market capitalization, which must be equal to or greater than $12.7 billion. Other criteria are liquidity, domicile, market capitalization, sector, financial viability, listing time, and representation of the sectors of the United States economy. The nine largest companies in the index represent 27.8% of the index’s market capitalization.
There are several ways to trade the S&P 500. Most retail brokers and spread betting platforms allow traders to use Contracts for Difference (CFDs) to place bets on price direction. In addition, you can buy index funds, mutual funds and exchange-traded funds (ETFs) that track the price of the S&P 500. The most liquid of the ETFs is the London Stock Exchange ETF. The most liquid of the ETFs is State Street Corporation’s SPY. The Chicago Mercantile Exchange (CME) offers futures contracts on the index and the Chicago Board of Options (CMOE) offers options, as well as ETFs, inverse ETFs, and leveraged ETFs.
There are many factors that drive the S&P 500, but primarily it is the aggregate performance of its component companies, revealed in their quarterly and annual earnings reports. US and global macroeconomic data also contribute, influencing investor sentiment, which if positive, drives earnings. The level of interest rates, set by the Federal Reserve (Fed), also influences the S&P 500, as it affects the cost of credit, on which many companies largely depend. Therefore, inflation can be a determining factor, as well as other parameters that influence the decisions of the Federal Reserve.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
