weekly market update 1/3/2025

Despite the S&P 500 registering its best Christmas Eve since 1974, as well as rising 1.25% on Friday, the Santa Claus rally failed to materialize for the second consecutive year.  Nonetheless, while December was unusually weak and saw the S&P 500 fall -2.5%, the index posted its first back-to-back years of over 20% returns since 1998.  Rising interest rates and rosy expectations have been recent headwinds for stocks, but on Friday stocks posted their best day since early November to break a five-day losing streak.  Heading into Inauguration Day, we expect investors to continue to look for insights into policy, particularly as it relates to tariffs and immigration, but next week will be headlined by the December jobs report on Friday.  The stock market will be closed on Thursday January 9th in remembrance of former President Jimmy Carter.

MARKET CONCENTRATION

Despite the S&P 500 registering its best Christmas Eve since 1974, as well as rising 1.25% on Friday, the Santa Claus rally failed to materialize for the second consecutive year.  Nonetheless, while December was unusually weak and saw the S&P 500 fall -2.5%, the index posted its first back-to-back years of over 20% returns since 1998.  Rising interest rates and rosy expectations have been recent headwinds for stocks, but on Friday stocks posted their best day since early November to break a five-day losing streak.  Heading into Inauguration Day, we expect investors to continue to look for insights into policy, particularly as it relates to tariffs and immigration, but next week will be headlined by the December jobs report on Friday.  The stock market will be closed on Thursday January 9th in remembrance of former President Jimmy Carter.

Ian G. Browning, CFA
Managing Director, Investment Strategies | Shareholder

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