Why Did the S&P 500, Nasdaq, and Dow Fall on January 17?

After falling 0.1% last week, the S&P 500 starting this week on a weaker note by falling 0.3% on January 17. The decline in the stocks was led by the financials, industrials, and health care sectors. The consumer staples sector helped the markets pare some losses. The market sentiment was weaker than last week. Trump didn’t provide clarity on his fiscal policies in his news conference on January 11.

The post-election gainers lost strength amid stronger government bonds and the weaker US dollar. The dollar is trading at one-month low levels. The market’s focus shifted to Trump’s inauguration on January 20.

The S&P 500 Index started the day on a stronger note, but it wasn’t able to hold the strength due to risk aversion at the beginning of the week. The S&P 500 VIX Index (CBOE Volatility Index) measures uncertainty in the market. On January 17, it rose 5.7% to 11.87—the highest levels since January 3. It’s measured on a scale on 1–100 with 20 as the historical average. It’s also called the “fear index.” It usually moves opposite to stock movements. The CBOE VIX generally falls when the S&P 500 rises.

After rising for two consecutive trading weeks and ending last week at record high levels, the Nasdaq Composite Index pulled back on January 17. The Nasdaq Composite started the week on a weaker note. It fell 0.63% and closed the day at 5,538.73. The Dow Jones Industrial Average moved away from the 20,000 level. It closed January 17 at 19,826.77—a fall of 0.3% (58.96 points). The SPDR S&P 500 ETF (SPY) fell 0.35%. Next, we’ll discuss how the financials and industrials sectors performed on Tuesday.