The Dow Jones industrial average (^DJI) slid 135 points, its first loss on the initial trading day of the year since 2008. And compare today's performance to a year ago, when the Dow soared 308 points. That was the second best gain of the year. The Standard & Poor's 500 index (^GPSC) fell 16 points, and the Nasdaq composite index (^IXIC) dropped 33.
The declines were broad-based, with the number of losers swamping gainers by nearly a 9-to-1 margin.
Here's why this down day may be worrisome: There's a very high correlation, nearly 90 percent, between what happens in January -- especially the first five days of January -- and what happens for the full year. It's certainly not time to panic, but it is something we'll keep a close watch on.
Despite the big losses, some of the interesting movers were on the upside.
Jefferies upgraded a number of retailers to "buy." Chico's (CHS) rose 3 percent, Urban Outfitters (URBN) and American Eagle (AEO) gained 2 percent, and ANN (formerly known as Ann Taylor) (ANN) jumped nearly 5 percent. However, Jefferies also lowered its ratings on two others. Abercrombie & Fitch (ANF) fell 2.5 percent and Aeropostale (ARO) edged lower.
And solar stocks extended their gains. First Solar (FSLR) and SolarCity (SCTV) both gained 5 percent, and Jinko (JKS) jumped 9 percent.
On the downside, Continental Resources (CLR) fell 4 percent following a government safety warning that the company's Bakken crude oil may be less stable than traditional crude. Noble Energy (NBL) and Chesapeake (CHK) both lost 2 percent.
Elsewhere, Apple (AAPL) fell 1.5 percent on a Wells Fargo downgrade. General Electric (GE) lost 2 percent.
What to Watch Friday:
- All day: Automakers release vehicle sales for December.
- Federal Reserve Chairman Ben Bernanke talks about how the Fed has changed over the years at a meeting of the American Economic Association, at 2:30 p.m. Eastern time.