U.S. stock indexes were little changed on Wednesday, with the S&P 500 trading a fraction shy of a fresh record as investors continued to chase a year-end rally amid lingering optimism that U.S. interest rates will fall in 2024.
How are stock indexes trading
- The S&P 500 SPX dipped 3 points, leaving it nearly flat, at 4,771
- The Dow Jones Industrial Average DJIA rose 38 points, or 0.1% to 37,584
- The Nasdaq Composite COMP lost 12 points, or 0.1%, to 15,061
On Tuesday, the Dow Jones Industrial Average rose 0.4%, to 37545, the S&P 500 increased 0.4%, to 4,775, and the Nasdaq Composite gained 0.5%, to 15,075.
What’s driving markets
A steady rally into the year end has further propelled the benchmark S&P 500 close to an all-time high, which leaves the index about 0.5% below its record closing high of 4,796.56, set on January 3rd, 2022.
The Wall Street equity benchmark is striving for a ninth consecutive week of gains, which would be its best such winning streak since 2004, having jumped 24.4% so far in 2023.
Investors have piled into stocks primarily on hopes that with inflation falling back near the Federal Reserve’s 2% target, the central bank will start reducing borrowing costs by the spring of 2024, and all while the U.S. economy avoids a recession.
“Aside from the customary Santa seasonality, any gains witnessed for the remainder of this week may be attributed to the notable increase in the probability of a soft landing, as indicated by the latest round of high-impact macroeconomic data from the United States,” said Stephen Innes.
Tom Lee, head of research at Fundstrat Global Advisors, said his team leans that markets will continue to rally in the last three trading days in 2023, given the strength of December already, which has seen the S&P 500 rise 4.5% so far this month .
“Given the trailing performance of fund managers, and the notion of ‘never short a dull market,’ we see the drift higher into the final days of 2023,” Lee said in a Wednesday client note.
That bullish narrative was being additionally supported Wednesday by a mostly positive return to trading by markets that were closed for an extended Christmas break, such as the U.K. UK:UKX, Germany DX:DAX, Australia AU:XJO and Hong Kong HK:HSI.
Indeed, Hong Kong and mainland China markets CN:SHCOMP were buoyed by a rebound for gaming stocks after Beijing appeared to take a more conciliatory tone towards the sector. American depositary shares of NetEase Inc. NTES, -5.38% were down 5.1% on Wednesday morning after rising as much as 14% in Hong Kong trading.
Companies in focus
- Shares of Cytokinetics Inc. CYTK, +65.35% jumped 68.3% on Wednesday, after the cardiovascular biopharmaceutical company announced positive results from a Phase 3 trial of aficamten, a treatment for hypertrophic cardiomyopathy (HCM).
- Iovance Biotherapeutics Inc.’s stock IOVA, -23.00% fell 21.7% after the cancer therapy company said the U.S. Food and Drug Administration placed a clinical hold on its trial for IOV-LUN-202.
- New York Times NYT, +1.91% shares rose 2.3% after the media company filed a federal copyright lawsuit against Microsoft Corp. and ChatGPT creator OpenAI in a legal action expected to shape the debate over generative-artificial-intelligence technologies.