A plunge in the world's largest crypto currency took Wall Street indices lower in the first full session after the Thanksgiving weekend on Monday. Weak macro data added to the pressure.
The Dow Jones fell over 400 points to end at the day's low. The S&P 500 fell 0.5%, while the Nasdaq fell 0.4%. The tech-heavy indices did not fall as much as they were supported by Nvidia and Apple shares, while Microsoft underperformed.
Bitcoin continued its plunge below the $90,000 mark, falling to as low as $85,000 on Monday as risk-off sentiment continued to hit cryptocurrencies. Leveraged positions worth over $1 billion were liquidated on Monday within the crypto market. Bitcoin also had its worst day since March this year.
Weakness in manufacturing activity did not help sentiment either. The index of ISM manufacturing stood at 48.2 in November, a further cool-off from the 48.7 reported in October. A reading below 50 indicates contraction. The manufacturing PMI has now remained in contraction territory for nine months in a row, as uncertainty prevails over trade policy and cost of goods.
Despite the plunge on Monday, UBS remains bullish on US equities, stating that stocks will continue to do well as long as the economy remains out of recession and the Fed rate cuts continue. The investment banking firm also expects the FOMC to cut by 25 basis points in October, with the current odds at 88%, according to the CME Fedwatch.
UBS expects earnings growth between 7% and 14% for major markets in 2026 and that will be a key driver for the markets going forward, according to their note.
Within the commodities market, Silver continues to make new highs, now nearing the $60 an ounce mark with tightening inventories and continued demand. Oil prices also rose after a key Kazakh-Russia pipeline link, which carried most of the former's crude exports, was damaged in a Ukraine attack.
