Equity markets kicked off the 2024 trading year on a sour note, with the S&P 500 falling about 1% at the session low. The move is partly due to a downgrade for Apple that shaved more than 4.25% off of its price. Barclays downgraded the stock to Underweight, citing concerns about hardware sales centered on the iPhone. At the same time, the VIX advanced to show a bottom and a high potential for a market reversal. The combination of weak S&P action and rising VIX suggests a top has been hit for equities that may result in a deep correction.

The primary catalyst this week, aside from the turning of the year, will be the NFP report on Friday. The NFP is expected to align with the outlook for a soft landing and may get the S&P 500 back into rally mode. If not, the market is heading lower in the first month of the year, which points to a soft first half followed by a rebound in the second, just like in 2023.