US Session: Strong Start for American Stocks in the Last Session of 2024

American stocks rose, breaking a three-day losing streak and strengthening Wall Street’s powerful rally in the final session of 2024. The S&P 500 and Nasdaq 100 indexes opened with gains, signaling a partial recovery after Monday’s declines of over 1%. Treasury bonds held on to small gains. The Bloomberg Dollar Spot Index also rose, on track to end the year with its best performance since 2015, fueled by the rally triggered by Trump’s re-election in November and a less “gentle” pivot in Federal Reserve policy.

Investors have much to consider for 2025. Some are concerned about the sustainability of the S&P 500’s 24% rally, driven by the so-called “Magnificent Seven” group of tech giants. There are also numerous uncertainties to address in the coming year, including the protectionist policies of President-elect Donald Trump, the future of central bank policy, and the state of European and Chinese economies.

“Investors are in a wait-and-see mode,” said Noelle Dixon, Senior Macro Strategist at State Street Corp., on Bloomberg Television. “We don’t know what the restorative effects will be or how the Federal Reserve will respond to these tariffs.”

In Asia, trading was light as several regional markets, including South Korea, were closed for a national holiday. Japanese markets will remain closed until January 6. Stocks fell in Australia and mainland China, while those in Hong Kong held steady. Chinese stocks ignored data showing improvements in both the services and manufacturing sectors. Investors also showed little reaction to President Xi Jinping’s statement that China’s economic growth for 2024 is expected to be around 5%, a target set by policymakers earlier in the year.

Meanwhile, in the latest sign of rising tensions between Beijing and Washington, the US Treasury Department stated it had been hacked by a Chinese state-linked actor via a third-party software service provider.