Wall Street Slides as December Kicks Off with a ‘Risk-Off’ Vibe and Bitcoin Tumble
Well, so much for a smooth start to the holiday trading season. Wall Street stumbled out of the gate on Monday, December 1, as investors returned from the Thanksgiving break with a decidedly “risk-off” attitude. All three major US indexes slipped as caution took hold ahead of a heavy week of economic news and a continued, sharp selloff in the crypto market sent tremors through the tech sector.
When the final bell rang, the losses were clear across the board. The Dow Jones Industrial Average dropped by approximately 0.7%, while the benchmark S&P 500 eased back by around 0.4% to 0.5%. The tech-heavy Nasdaq Composite also finished in the red, down roughly 0.3% to 0.4%. The negative start to the month follows a volatile November for the Nasdaq, which registered its first losing month since March, while the Dow and S&P 500 had managed to extend their streak of monthly gains.
One of the biggest drags on the market was the bond sector, with yields on US Treasury notes climbing. This move was partly sparked by global signals, specifically a hint from the Bank of Japan’s governor that a local interest rate hike could be on the horizon. Higher rates tend to make the perceived safety of government bonds more appealing, pulling capital away from riskier assets like stocks.
However, the real head-turner of the day was the dramatic plunge in the cryptocurrency world. Bitcoin, the market’s flagship digital coin, tumbled hard, extending a weeks-long selloff. The price dropped as much as 7% at one point during the session, sliding below the key $86,000 level and trading around $85,400. This volatility is part of a broader correction for Bitcoin, which had reached a record high of nearly $125,000 just two months prior in early October.
The cryptocurrency’s weakness immediately impacted publicly traded companies with ties to the digital asset space. Shares of major crypto-linked firms experienced a sharp decline, with companies like the trading platform Coinbase Global, mobile trading giant Robinhood Markets, and MicroStrategy, a major Bitcoin holder, all falling between roughly 3% and 7%. This pattern underscores the growing link between the mainstream stock market and the highly volatile crypto environment.
Beyond the macro and crypto headwinds, investors were also positioning themselves defensively ahead of major economic reports due later in the week, including the delayed September PCE inflation report. All this comes just before the Federal Reserve’s next interest rate decision, adding to the general caution on Wall Street. While some analysts see the current environment as a pause for breath after last week’s rally, the first trading day of December certainly reminded everyone that market volatility remains a constant fixture of the investment landscape.
