(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window)*Tesla shares plunge on Q4 deliveries miss*Apple hits lowest level since June 2021*Indexes down: Dow 0.56%, S&P 0.81%, Nasdaq 1.09%Jan 3 (Reuters) - Wall Street's main indexes dropped on
the first trading day of 2023 with big drags from Tesla and
Apple, while investors worried about the Federal Reserve's
interest-rate hiking path as they awaited minutes from its
December meeting.Shares in electric vehicle maker Tesla Inc were
down 13%, making it Nasdaq's biggest percentage decliner after
missing Wall Street estimates for quarterly deliveries. iPhone
maker Apple Inc was down 4% after hitting its lowest
level since June 2021 following an analyst rating downgrade due
to production cuts in China.Consumer discretionary and technology stocks
slipped more than 1% each.The energy sector, which logged stellar gains in
2022, slid more than 4%, tracking lower oil prices on bleak
business activity data from China and concerns about the outlook
for the global economy..The main U.S. stock indexes had ended 2022 with their
steepest annual losses since 2008 following the Fed's fastest
pace of rate hikes since the 1980s to stamp out decades-high
inflation."Even though the calendar has changed, a lot of the main
issues for the market have not, specifically with the Federal
Reserve tightening monetary policy as it's still concerned about
inflation," said Chris Zaccarelli, chief investment officer at
Independent Advisor Alliance in Charlotte, North Carolina."We're in a bear market. Negative is the default reaction to
everything," he said. "Until the Fed really changes their tone,
it's an uphill battle for the market."By 2:22 p.m. ET, the Dow Jones Industrial Average had
fallen 186.41 points, or 0.56%, to 32,960.84; the S&P 500
had lost 31.1 points, or 0.81%, to 3,808.4; and the Nasdaq
Composite had dropped 114.14 points, or 1.09%, to
10,352.35.The S&P 500 shed 19.4% in 2022, marking a roughly $8
trillion decline in market capitalization, while the Nasdaq fell
33.1%, dragged down by growth stocks.Investors on Wednesday will closely monitor the minutes of
the Fed's December policy meeting, when the central bank raised
interest rates by 50 basis points after four straight 75 basis
points hikes, and signaled rates could stay higher for longer.Other economic data due this week includes the ISM
manufacturing report, also on Wednesday, and December's jobs
report on Friday.Weakness in the labor market could give the Fed a reason to
ease its monetary policy tightening, but the data so far has
shown the market remains tight despite rate hikes.Money market participants see a 68% chance the Fed will
raise the benchmark rate by 25 basis points to 4.50% to 4.75% in
February, with the rates peaking at 4.98% by June.In other equity market action, U.S.-listed Chinese firms
such as Alibaba Group Holding Ltd, JD.com Inc
and Pinduoduo Inc rose between 1% and 5% on
post-COVID-19 recovery hopes.Advancing issues outnumbered declining ones on the NYSE by a
1.10-to-1 ratio; on Nasdaq, a 1.01-to-1 ratio favored decliners.The S&P 500 posted one new 52-week high and five new lows;
the Nasdaq Composite recorded 83 new highs and 44 new lows.
(Reporting by Sinéad Carew in New York; Shubham Batra, Ankika
Biswas and Amruta Khandekar in Bengaluru; Editing by Shounak
Dasgupta, Arun Koyyur and Jonathan Oatis)