Wall Street experienced mixed results on Thursday as the post-holiday trading resumed, with the S&P 500 slipping less than 0.1% after three consecutive gaining days. This slight decline marked the end of the benchmark index’s brief winning streak, as it wavered through small gains and losses throughout the session.
The Dow Jones Industrial Average added 0.1%, and the Nasdaq composite also experienced a tiny fall of 0.1%. Trading volume was lighter than usual, aligning with typical market behavior following the Christmas holiday, which is often characterized by decreased activity as investors return to their desks.
Among the notable issues on the S&P, semiconductor giant Nvidia saw its valuation wane slightly, dipping 0.2%. Similarly, Meta Platforms, Amazon, and Netflix experienced declines of around 0.9%, and Tesla, one of the bigger names on Wall Street, finished 1.8% lower. This downward trend among major tech companies was significant, as these stocks wield considerable influence on index movements.
Despite some heavyweight tech stocks dragging the indexes down, there were bright spots, particularly among healthcare and retail stocks. CVS Health rose 1.5%, and Walgreens Boots Alliance achieved the largest gain among S&P 500 stocks, jumping 5.3%. Retailers showed promising signs as well, with Target rising 3%, Ross Stores adding 2.3%, Best Buy increasing 2.9%, and Dollar Tree gaining 3.8%. The enthusiasm around retail stock performance can be largely attributed to the post-Christmas shopping surge, which historically ranks among the top 10 biggest shopping days of the year.
Company shares listed in the U.S. from automotive giants Honda and Nissan both enjoyed substantial gains of 4.1% and 16.4% respectively, following announcements about the two companies exploring potential merger talks.
The trading day also brought updates from the labor market, where the Labor Department reported stability for U.S. applications for unemployment benefits, holding steady last week. Nonetheless, continuing claims rose to the highest level seen in three years, adding to concerns about the job market's health.
Treasury yields mostly fell across the bond market, with the yield on the 10-year Treasury slipping to 4.58% from 4.59% earlier this week. With many European markets closed alongside those of Hong Kong, Australia, New Zealand, and Indonesia, market participants anticipated subdued trading as firms faced limited economic data on the calendar.
Historically, U.S. markets experience positive movement at year’s end; the last five trading days of the year, plus the first two days of the following year, have averaged gains of about 1.3% since 1950. So far this month, investors remain cautious as the stock market has retraced some of its gains linked to expectations following President-elect Donald Trump’s election win. Initially, the market buoyed on hopes for economic growth, potentially looser regulations, and boosted corporate profits. Yet, sentiments have dimmed as concerns grow over Trump's inclination toward tariffs and other economic policies which could instigate high inflation and escalate U.S. government debt.
Regardless of these apprehensions, analysts remain optimistic about the market’s potential for strong returns heading toward 2024. Notably, the benchmark S&P 500 remains up 26.6% year-to-date and approaches its most recent record high set earlier this month—its 57th record high of the year.
Looking forward, Wall Street anticipates several significant economic reports next week, offering insights on pending home sales, home prices, and U.S. construction spending. Each of these indicators will be pivotal for investors as the market navigates the post-holiday season and heads toward the new year.
