Stock market today: Dow wobbles on jitters ahead of Fed meeting, big tech earnings

© Reuters.

By Yasin Ebrahim

Investing.com -- The Dow closed lower Monday as investors were reluctant to load up on bullish bets ahead of the Federal Reserve decision and further quarterly earnings from big tech this week.

The S&P 500 fell 1.3%, the Dow Jones Industrial Average slipped 0.8%, or 260 points, and the Nasdaq Composite closed down 2%.

The Federal Reserve kicks off its two-day meeting on Tuesday, but with the prospect of a downshift to a 25-basis-point rate hike almost priced in for Wednesday, investors are expecting Fed chairman Jerome Powell to signal more hikes ahead and push back against expectations that the Fed could cut rates later this year.

“The 25 basis points hike is priced into the market,” Chief Strategist at Spouting Rock Asset Management Rhys Williams told Investing.com’s Yasin Ebrahim in an interview on Monday. “If Powell says we're not nearly done yet, then the market is going to sell off and some of the big January performance of the more longer duration assets [such as tech], will sell off.”

Technology was the biggest laggard ahead of a pivotal week as the bulk of big tech reports quarterly results, with Meta Platforms (NASDAQ:META) reporting results on Wednesday followed by Alphabet Inc (NASDAQ:GOOGL), Apple, and Amazon.com (NASDAQ:AMZN) on Thursday.

Apple (NASDAQ:AAPL), which fell 2% but is up 14% year to date, is expected by some on Wall Street to have benefited from an easing supply chain and a weaker dollar, though iPhone revenue was likely challenged by production challenges in China.

“We expect iPhone revenue was challenged due to well-publicized production challenges at an assembly facility for the iPhone 14 Pro and Pro Max, however, management had expected silicon shortages to be immaterial for the quarter, so we believe the company was able to meet demand for Mac and iPad,” Credit Suisse said in note.

Tech was also dragged lower by chip stocks amid pressure from weakness in Advanced Micro Devices (NASDAQ:AMD) ahead of the chipmaker’s results due Tuesday as sentiment on semis soured following the dire results from Intel Corporation (NASDAQ:INTC) last week.

GE HealthCare Technologies Inc (NASDAQ:GEHC) reported its maiden earnings after it was spun off as a public company from General Electric (NYSE:GE). The healthcare technology and diagnostics company reported Q4 earnings of $1.31 on revenue of $4.9 billion.

Energy stocks also played a role in the broader market selloff as oil prices fell more than 2% ahead of rate hikes by major central banks expected this week and still strong Russian oil exports.

Marathon Oil Corporation (NYSE:MRO), Occidental Petroleum Corporation (NYSE:OXY), and Devon Energy (NYSE:DVN) were among the worst decliners, with the latter down more than 4%.

In other news, Ford Motor (NYSE:F) fell nearly 3% on worries about waning demand after the company cut prices of its electric Mustang Mach-E crossover.