Global Markets
It appears that the “Santa Claus Rally” rally is in full event, which is the phenomenon in financial markets where stock prices tend to rise during the final week of December, specifically from the last five trading days of the year through the first two trading days of January. This period often sees a boost in market performance, barring there are no major economic or geo-political concerns.
Canadian Markets
Canadian markets traded 0.40% higher on Tuesday, as investors evaluated the implications of Monday’s GDP contraction report, marking the first economic contraction in Canada this year. This development has cast a shadow over market sentiment, contributing to the underperformance of Canadian equities compared to their U.S. counterparts.
The GDP contraction signals that the Canadian economy is grappling with challenges such as slower consumer spending, weaker business investment, and the impact of higher interest rates. These factors have dampened confidence in the domestic growth outlook, prompting a more cautious approach from investors.
American Markets
U.S. stock markets experienced gains during a shortened trading session ahead of the Christmas holiday. The S&P 500 rose by 1.10%, the Dow Jones Industrial Average increased by 0.91%, and the Nasdaq Composite climbed by 1.35%. This market advance was largely driven by strong performances in the technology sector.
European Markets
European stock markets traded Tuesday mixed. UK markets rose on the mining sector, with Rio Tinto and Anglo American leading the way, which saw their share prices increase by 0.8% and 1.2%, respectively.
Vistry Group: Shares of homebuilder Vistry dropped 16.3% following its third profit warning since October, impacting the household goods and home construction index, which fell by 2.1%.
Japanese Markets
Japanese stock markets experienced a slight decline, with the Nikkei 225 index slipping by 0.3% to close at 39,036.85. Minutes from the Bank of Japan’s October meeting revealed policymakers’ commitment to raising interest rates if economic and inflation conditions align. This stance introduces caution among investors, as potential rate hikes could impact market liquidity and borrowing costs.
Chinese Markets
Chinese stock markets closed substantially higher, reflecting increased investor optimism. Recent reported data indicate that Chinese policymakers plan to issue a record 3 trillion yuan ($411 billion) in special treasury bonds for 2025, aiming to stimulate economic growth. As a result, the government is expected to implement initiatives to boost consumption, including raising pensions and medical insurance subsidies, enhancing consumer spending power, which resulted in these policy measures bolstering investor confidence.
Top Stock Performers:
- Super Micro Computer (SMCI): Led the gains with a 6% increase, largely due to an anticipated extension for filing financial reports, avoiding delisting from Nasdaq.
- Tesla (TSLA): Rose by 5.1%, amidst news of a potential Honda-Nissan merger.
- Broadcom (AVGO): Increased by 2.1%, with optimism for its long-term prospects despite high competition in the semiconductor sector.
- Nvidia (NVDA): Gained 0.8%, following a bullish outlook by Morgan Stanley on AI chips, boasting a 184% annual gain.
- Amazon (AMZN): Rose by 1.6%, contributing to the positive momentum in the tech sector.
STA Research (StockTargetAdvisor.com) is a independent Investment Research company that specializes in stock forecasting and analysis with integrated AI, based on our platform stocktargetadvisor.com, EST 2007.
