Market Recap: Stocks Rally in Holiday-Shortened Session on December 24, 2024
Why Was the Market Up Today? Tech Stocks Lead Santa Claus Rally
The U.S. stock market closed higher on Tuesday, December 24, 2024, in a holiday-shortened trading session, as investors embraced the spirit of the season with a Santa Claus rally. Major indexes posted gains, driven primarily by strong performances in the technology sector.
Current Market Indexes Performance
As of the early close at 1 p.m. ET on Christmas Eve:
– The S&P 500 (^GSPC) rose 65.97 points, or 1.1%, to 6,040.04.
– The Dow Jones Industrial Average (^DJI) gained 390.08 points, or 0.9%, to 43,297.03.
– The Nasdaq Composite (^IXIC) advanced 266.24 points, or 1.3%, to 20,031.13.
– The Russell 2000 (^RUT) index of smaller companies increased 22.42 points, or 1%, to 2,259.85.
This upward movement has erased the S&P 500’s December losses, putting the index on track for a stellar year with a 26.3% gain in 2024.
Major Stock News and Movements
Several “Magnificent Seven” stocks led the day’s rally:
1. NVIDIA Corporation (NVDA): Up 3.7%
2. Tesla, Inc. (TSLA): Increased 2.3%
3. Meta Platforms, Inc. (META): Surged 2.5%
4. Alphabet Inc. (GOOG): Gained about 1.6%
5. Amazon (AMZN) and Apple (AAPL): Modest increases
6. Microsoft (MSFT): Slight decline of 0.3%
Other notable stock movements:
– American Airlines (AAL): Shares recovered from an early slump after a technical issue briefly grounded flights nationwide.
– Advanced chipmakers Broadcom (AVGO) and Advanced Micro Devices (AMD) continued to rise, benefiting from analysts’ bullish comments on their artificial intelligence potential.
Upcoming Market Events and Economic Factors
1. Federal Reserve Policy Outlook: Despite the strong tech gains, market participants remain concerned about the Fed’s future policies. The CME FedWatch tool indicates a 91.4% probability of the Fed maintaining current rates at its January meeting, creating some economic uncertainty.
2. Treasury Yields: The 10-year Treasury yield ticked up to 4.63%, having risen more than 20 basis points since the Federal Reserve scaled back its forecast for future interest rate cuts last week.
3. Cryptocurrency Movement: Bitcoin (BTCUSD) surged to $97,000 after a recent dip below $93,000, showing resilience despite the impact of last week’s Fed decision.
4. Commodities: Oil futures traded slightly higher, with West Texas Intermediate at approximately $69.75 a barrel. Gold futures remained steady at $2,630.
5. Holiday Impact: The stock market closed early at 1 p.m. ET, and the bond market at 2 p.m. ET for Christmas Eve. Both markets will be closed on Christmas Day and reopen on Thursday.
Market Sentiment and Future Outlook
The current rally aligns with the historical “Santa Claus rally” phenomenon, where stocks tend to rise over the last five trading days of the year and the first two of the new year. However, analysts note that the rally has lacked strong momentum, and December 2024 is shaping up to be an outlier unless it receives “serious help” in the coming days.
As we approach the end of 2024, the S&P 500 has put up impressive numbers, with a year-to-date gain of 26.3%. The Dow is up 14.9%, while the tech-heavy Nasdaq has surged 33.4%.
Investors will be closely watching how the markets perform in the remaining days of 2024 and the start of 2025, particularly in light of ongoing concerns about Federal Reserve policies and global economic conditions.
Conclusion
The stock market’s performance on December 24, 2024, provides a positive note as we head into the holiday break. With tech stocks leading the charge and the S&P 500 erasing its December losses, investors have reason for optimism. However, the sustainability of this rally and its implications for the coming year remain to be seen, as economic uncertainties persist.
As always, investors are advised to stay informed about upcoming economic events and corporate earnings reports that could impact market movements in the new year.
