Stocks and Treasuries began 2024 on a sour note, as last year's rally came to a halt and traders reduced their bets on interest rate cuts.

The Nasdaq 100 fell 1.7%. The benchmark fell the most in two months on Tuesday, as last year's winners, the Magnificent Seven, slumped. Nvidia and Facebook parent Meta Platforms also fell after an analyst at Barclays warned that iPhone demand is cooling. The 10-year Treasury yield increased to 3.94%.

After a more than $8 trillion surge in the S&P 500 last year, the first trading day of the new year brought 2023's scorching rally to a halt.

The Cboe Volatility Index, or VIX, increased by around 6%, one of the largest gains since Federal Reserve Chair Jerome Powell's pivot last month. The fear gauge on Wall Street remains low.

The data on job openings on Wednesday and nonfarm payrolls on Friday will also be scrutinised for signs of labour market weakness.