01/07 U.S. stock markets open for sale on impact of Trump regulatory issues after digesting economic indicators
The U.S. stock market started steady, digesting economic indicators such as employment and service index. Since then, the Dow, which has recently risen, has fallen mainly in the financial sector. Although the Nasdaq has seen a contraction in semiconductors, which have been strong recently, the rise of software and pharmaceutical stocks is progressing. However, in the latter part of the market, Trump’s remarks on banning institutional investors from buying single-family homes and restricting the return of defense companies’ shareholders have expanded to regulatory risks, reducing gains and expanding falls (Dow -0.94%, Nasdaq +0.16%; S&P 500 -0.34%, Russell 2000 -0.29%; Philadelphia Semiconductor Index -0.99%)
*Variants: Employment and Services Index, Trump Regulations
According to a job report by JOLTs in November, the construction industry (+9.0 million cases) driven by demand for data centers led job openings, but the total number of job openings decreased by 11% year-on-year to 7.15 million due to slowing demand in private services such as accommodation, food (-148,000 cases) and wholesale. Although voluntary retirement has increased by 2.08 million and workers’ confidence has been maintained, the low level of employment shows a cooling state of the job market. However, the market weighed on the possibility of a soft landing as layoffs remained low at 1.7 million, indicating a weaker dollar, lower Treasury yields and a solid tech-heavy stock market
The ISM service industry index recorded 54.4, an improvement from the previous month’s 52.6 in December, with strong confidence in growth in the first half of 2026. In particular, new orders, a leading indicator, surged 5.0p to 57.9, and the employment index also entered an expansion phase (52.0) in seven months, raising expectations for a soft landing through the resumption of manpower demand in the service sector. Although the price index is still above the 60th level, it fell slightly (64.3) to continue the trend of slowing inflation, and this strong indicator led to the rise of technology stocks based on optimism about the economy, despite reducing the decline in interest rates on government bonds during the day
However, the upward momentum of the stock market slowed due to the news that Trump initiated immediate measures to restrict institutional investors’ purchase of single-family homes and requests for legislation to stabilize housing prices. The news shifted the stock prices of large asset managers, single-family rental REITs, and major construction companies with a high proportion of institutional-oriented mass sales (BTR) or expanded their declines. In general, the market is assumed to have been held for profit taking advantage of policy risks. Ahead of the closing of the market, uncertainty has flowed in, with regulatory issues continuing to fall due to the announcement of a ban on dividends and treasury stock purchases to the defense sector, leading to a drop in regulatory issues such as related companies
*Featured stocks: Eli Lilly, Alphabet rise Vs. financials, industrial goods and more sluggish
Semiconductors: Nvidia up Vs. AMD fall
Nvidia (+1.00%) rose after announcing that production of H200 chips is accelerating and that it is aiming to resume exports to China before the Lunar New Year in February. Of course, the Chinese government has instructed its companies to stop ordering H200 purchases, but the impact is limited in that the related ban is not a permanent ban. After all, Nvidia’s expectations for H200 exports to China are a factor in the rise. AMD (-2.02%) fell after Intel’s chip announcement at CES, reflecting intensifying competition. AMD also announced new chips recently, but continued to fall amid negative reviews. While Broadcom (-0.08%) also turned downward, TSMC (-2.67%) fell due to profit-taking
Semiconductors: Mostly profit-taking opens lower Vs. Intel gains
Storage companies such as Western Digital (-8.89%) and Seagate (-6.71%) surged due to speculative funds, reflecting expectations of price hikes due to AI demand, but fell sharply today due to the opening of profit-taking sales. On the other hand, SanDisk (+1.12%), which had surged while driving the market, showed strength to turn upward as the number of call option transactions in the range of $340 to $370 surged, showing speculative demand to bet on further gains. When Micron (-1.13%) fell as profit-taking sales were released, Texas Instruments (-3.33%) and Ram Research (-1.87%) fell. The Philadelphia Semiconductor Index fell 0.99%. Intel (+6.47%) surged, reflecting expectations for AI PC chips unveiled at CES.
Cars: Tesla Bounces Back With Inflow Of Backward Buying
Tesla (-0.36 percent) rose due to the influx of reversals from the previous day’s decline, but the market turned downward just before the market closed due to Nvidia’s announcement of self-driving technologies. Electric car companies are mixed, with Rivian (+2.71%) rising while Lucid (-5.17%) falling. GM (-0.33 percent) and Ford (-0.43 percent) partially reduced their fall on news of U.S. Treasury Secretary Bessent’s tax credit of up to $10,000 when purchasing U.S. cars. Secondary battery companies, including QuantumScape (-3.54%) fell while their upward momentum was limited. Lithium-related stocks such as Albemarle (+2.16%) and SQM (+0.76 percent) rose as China’s carbon lithium price rose by 4.54 percent.
Big Tech Stocks: Alphabet Up Vs. Meta Slump
Alphabet (+2.51%) rose on the news that its traffic share on the Generative AI website surged to 21.5% today from 5.7% a year ago. ChatGPT’s share, on the other hand, fell from the 80% range to less than 65%. Users also surged to 62 million daily active users in December, a 351% jump year-on-year. The monthly active users also hit 650 million. MS (+1.04%) rose today as it continued to fall since November with an influx of backlash buying. In particular, many investment companies, including Wedbush, recently said 2026 will be an inflection point for Microsoft’s AI growth, and positive comments on its growth were affected. Amazon (+0.26%) continued to rise after the recent announcement of new products.
Apple (-0.77%) continues to fall due to sluggish iPhone sales and concerns over slowing margin rates due to rising chip prices. Concerns over slowing margin rates due to rising chip prices are affected by Apple, Dell (-3.11%) and HP (-4.79%). Meta Platforms (-1.81%) are technically controlled by the Chinese government’s acquisition of AI startup Manus