Reuters news on December 27, 2024 shows that the crypto market is going through a challenging period when crypto-related stocks such as MicroStrategy, MARA Holdings and Coinbase Global all fell sharply from 1.9% to 4.8%, after Bitcoin dropped 3.9%. This is one of the difficult days for investors as the crypto market is constantly under pressure from the volatility of US government bond yields.
The yield on 10-year U.S. Treasuries has reached its highest level since May, holding steady at 4.64% at the start of trading, before dipping slightly to 4.58% in the afternoon. This rise in yields typically has a negative impact on growth stocks, particularly large tech stocks.
The tension in the market is not limited to bond yields. A newly released report shows that the number of Americans filing for new unemployment benefits has dropped to the lowest level in a month, indicating that the U.S. labor market is still maintaining fairly good health, despite signs of cooling.
While major indices like the Dow Jones and S&P 500 remained nearly unchanged, with the Dow Jones only edging up 0.07%, the Nasdaq showed a slight decline, marking the end of a four-session winning streak. This is a clear indication of the pressure that high yields are placing on the stocks of tech companies that have led the market upward with hopes for a lower interest rate environment and high profit potential from artificial intelligence.
This situation highlights the importance of contributions from other sectors of the economy if we want to see the overall market continue to rise. At the same time, the crypto market also needs to pay attention to adjusting strategies if it wants to maintain its appeal and avoid being negatively impacted by broader economic factors.
(Reference from Reuters)
