Inventory indexes posted combined outcomes on Thursday of their first buying and selling session following Christmas, tempering the momentum of the so-called Santa Claus rally.
The Dow Jones Industrial Common added about 29 factors, closing 0.1% greater, whereas the S&P 500 edged down barely to complete practically flat. The Nasdaq additionally declined marginally, slipping 0.1%.
These combined performances got here after two consecutive days of positive factors, with Wednesday’s rally kicking off the Santa Claus interval—a traditionally bullish stretch comprising the final 5 buying and selling days of the 12 months and the primary two of January. Traditionally, this era has seen the S&P 500 rise a median of 1.3%.
This 12 months’s rally started robustly on Christmas Eve, with the Dow climbing practically 400 factors and the S&P 500 rising 1.1%, delivering the index’s strongest Christmas Eve efficiency since 1974.
Merchants stay optimistic that the rally will shut out the 12 months on a excessive notice and pave the way in which for continued positive factors in 2024.
“When Santa delivers a optimistic Santa Claus Rally return, the S&P 500 has traditionally generated a median January achieve of 1.4% and an annual ahead return of 10.4%,” mentioned Adam Turnquist, Chief Technical Strategist at LPL Monetary, in a Tuesday notice.
Nonetheless, Turnquist cautioned that if shares decline throughout this era, the S&P 500 sometimes sees flatter efficiency in January and a extra modest ahead annual return of 5%.
Elsewhere, the most recent labor market knowledge revealed potential challenges forward. Persevering with unemployment claims surged to 1.91 million, the best stage in over three years, signaling elevated job market pressure. Preliminary jobless claims for the week got here in at 219,000, barely under consensus estimates of 225,000.