Wall Street stocks fell on Thursday, December 26, amidst a lackluster post-Christmas trading session. The US benchmark Treasury yield reached its highest level in eight months, while jobless claims surged to a three-year high.
Despite the “Santa Claus rally” – a holiday season boost that typically sees stocks rise due to low liquidity and tax loss harvesting – investors were cautious. Uncertainties around President-elect Donald Trump’s policies lifted gold prices and contributed to the higher Treasury yield.
The 10-year US Treasury yield rose 3.2 basis points to 4.619%, its highest level since April, while the 30-year bond yield increased by 2.5 basis points to 4.7863%. The dollar also strengthened against major currencies on expectations of benefiting from Trump’s policies.
The Dow Jones Industrial Average fell 28.97 points, or 0.07%, while the S&P 500 and Nasdaq Composite slipped 4.50 and 18.10 points, respectively. Emerging market stocks fell 1.47 points, or 0.14%.
New claims for unemployment benefits came in slightly below estimates, but ongoing claims jumped to their largest number since November 2021. The major concerns for 2025 include the Federal Reserve’s monetary easing, Trump’s tariffs, and geopolitical tensions.
Investors are bracing for a potential interest rate hike by the Fed in the first half of next year, with some predicting yields could reach 4.75% to 5.0%.
Source: https://www.reuters.com/markets/global-markets-wrapup-1-2024-12-26