The Final Countdown: What Investors Need to Know for 2024
As the year comes to a close, investors are bracing for a relatively quiet week ahead. With a shortened trading session on Tuesday and a day off on Wednesday, the focus shifts to the possibilities of a “Santa Claus Rally” and the latest developments in Washington, D.C.
Market Outlook: Mixed Signals
U.S. stock futures are sending mixed signals early Monday, with S&P 500 futures flat, Dow Jones Industrial Average futures lower, and Nasdaq futures ticking upward. Despite ending the week with losses, all three indexes finished Friday higher, rising 1% or more. The benchmark 10-year Treasury yield is slightly higher, trading at 4.54%, while oil and gold futures are edging lower. The U.S. dollar is strengthening against a basket of foreign currencies, and Bitcoin is trading up 1% at around $96,000.
Economic and Corporate Calendars: A Lighter Load
The winter holidays are upon us, and the economic and corporate calendars are reflecting the slower pace. While there are still some key events to watch, the schedule is undoubtedly lighter in the days ahead. However, some traders will be keeping an eye on the possibility of a Santa Claus Rally, which has historically seen stocks rise during the period marked by five trading sessions of one year and the first two of the next.
Washington Update: Clarity Emerges
Over the weekend, President Biden signed a stopgap funding measure, averting a government shutdown and removing a measure of political uncertainty from investors’ calculations. The move raises fresh questions about matters including possible Republican opposition to some of Trump’s policies, the position of current House Speaker Mike Johnson, and the future of the debt ceiling.
Big-Auto Industry Deal on the Horizon
Honda and Nissan have announced plans to discuss a business integration, solidifying reports and statements from last week. The two Japanese companies will explore forming a joint holding company, which would list on the Tokyo stock exchange by August 2026. The tie-up aims to leverage technology, supply-chain efficiencies, and cost savings.
Nasdaq 100 Index Changes
This morning, MicroStrategy, Palantir Technologies, and Axon Enterprise will join the Nasdaq 100 index, replacing Super Micro Computer, Moderna, and Illumina. The changes follow several other recent high-profile index tweaks, including two changes to the S&P 500 and the addition of Nvidia to the Dow industrials, replacing Intel.
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