Wall St Week Ahead-Investors hope for 'Santa Claus' rally as stocks lose steam
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With December so far delivering Scrooge-like returns in an otherwise stellar year for U.S. stocks, investors hope the tail end of 2024 offers some holiday cheer, but warn of potential headwinds. The benchmark S&P 500 is up more than 23% for 2024, even after a major stumble this week, and Wall Street has historically often enjoyed a strong annual close. Since 1969, the last five trading days of the year combined with the first two of the following year have yielded an average S&P 500 gain of 1.3%, a period known as the "Santa Claus Rally," according to the Stock Trader's Almanac. But this year, there are signs Santa Claus may disappoint. The S&P 500 on Wednesday suffered its biggest one-day drop since August after the Federal Reserve caught investors off guard by signaling fewer-than-expected interest rate cuts in 2025. The market also looks less healthy beneath the surface: Eight of the 11 S&P 500 sectors ...