After Merry Pre-Holiday Rally, Fresh Job Data Due
Schwab Market Update Audio
Deep Dive
Why did tech stocks lead the market rally on Tuesday?
Tech stocks, particularly big semiconductor firms, led the market rally due to surging demand. MegaCap stocks like Nvidia, Tesla, and Apple, which are less sensitive to climbing rates, also contributed significantly. Nvidia's rise may be linked to anticipation of a major speech by CEO Jensen Huang in early January, potentially unveiling details about its next-generation Rubin chip.
What is the significance of the Santa Claus rally period?
The Santa Claus rally period, which starts on Christmas Eve and ends two sessions into the new year, traditionally marks a time of increased buying interest in the stock market. This year, it saw broad participation from sectors like retailers, automakers, airlines, restaurants, and hotels, contributing to the market's strength.
How close is the S&P 500 to its all-time highs?
The S&P 500 index is back within 1% of its all-time highs, where it stalled earlier this month amid inflation and rate concerns. Despite historically high valuations and climbing Treasury yields, the index showed strength this week.
What are the current expectations for the Fed's rate decisions?
The CME FedWatch tool places the odds of a January rate pause above 90%, with just two rate cuts projected for next year, down from four previously. Futures trading also suggests more than a 50% chance of no rate cuts during the first quarter of 2025, following three consecutive cuts totaling 100 basis points.
What is the consensus for weekly initial jobless claims?
The consensus for weekly initial jobless claims is 232,000, following the prior week's 220,000. Claims above 240,000 are likely to raise concerns, while continuing claims remain at 1.874 million, close to recent three-year highs.
How did the major indices perform on Tuesday?
On Tuesday, the S&P 500 index climbed 65.97 points (1.1%) to 6,040.04, the Dow Jones Industrial Average added 390.08 points (0.91%) to 43,297.03, and the Nasdaq Composite rose 266.24 points (1.35%) to 20,031.13. This marked the Nasdaq's best Christmas Eve performance since 2000.
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