In today’s trading session, stocks displayed a marginal increase as the market sought to build upon its recent positive momentum. The Dow Jones Industrial Average gained 43 points, representing a 0.1% rise, while the S&P 500 saw a 0.2% increase, and the Nasdaq Composite advanced by 0.3%.
Within the S&P 500, standout performers included solar company Enphase Energy and consumer health firm Kenvue, both witnessing more than a 4% surge. Communication services stocks also outperformed, with Meta Platforms’ shares rising over 1%, and Alphabet experiencing a 0.7% gain.
This upturn follows a successful previous session, where the S&P 500 climbed by 0.45%, positioning it just 1.2% away from its all-time closing high recorded in January 2022. The Nasdaq Composite registered a 0.6% increase, while the Dow achieved marginal growth.
Recent market dynamics reflect a shift to rally mode, notably fueled by last week’s signal from the Federal Reserve indicating three anticipated interest rate cuts in 2024. Factors such as moderating inflation and a decline in Treasury yields have further contributed to the positive sentiment surrounding risk assets.
Emily Roland, co-chief investment strategist at John Hancock Investment Management, highlighted this optimistic outlook, stating, “Markets are celebrating right now, not only disinflation, but the soft landing scenario.”
As the month approaches its end, all three major averages are on track to conclude December with gains. The S&P 500 has risen nearly 4%, continuing its longest weekly winning streak since 2017, while the Nasdaq and Dow have posted gains of 5.1% and 3.9%, respectively.
Additionally, the market witnessed a substantial influx of funds into the SPDR S&P 500 ETF Trust (SPY), reporting a net inflow of $20.8 billion on Monday. This influx, more than doubling SPY’s net inflows for the year, suggests a growing investor confidence in the ongoing stock rally.
In premarket activities, notable stock movements included Amgen’s 1.4% gain following an upgrade by BMO Capital Markets and Sunnova’s 5.1% jump after receiving an overweight rating from Piper Sandler. Pharmaceutical company Arvinas also experienced a more than 5% increase following an upgrade by Wells Fargo.
While the market currently enjoys a positive trajectory, JPMorgan’s Marko Kolanovic remains cautious, expressing concerns about “the interest rate shock” negatively impacting economic activity and advising a preference for cash and bonds over equities.
In other financial news, Japan’s Nippon Steel witnessed a 5.8% plunge after announcing a $14.9 billion deal to acquire U.S. Steel, and the Japanese yen strengthened ahead of the Bank of Japan’s rate decision.
As the year draws to a close, major averages reflect substantial gains, signaling a resilient market amid ongoing economic uncertainties.