Home > Weekly Recap: Stocks eye Santa rally as Bitcoin cracks $50,000 barrier

Weekly Recap: Stocks eye Santa rally as Bitcoin cracks $50,000 barrier

  • The S&P 500 rose 2.3% on Christmas week, with the Nasdaq Composite up 3.2% and Dow Jones Industrial Average increased 1.7%. 

  • This happened as investors bought the week’s dip to set the market finely for the final week of 2021.

  • Gold held above $1,800 for a second week running

  • Bitcoin rallied to a two-week high, breaking the $50,000 barrier

This was a shortened trading week for stocks markets, with no sessions on Friday as the Christmas break kicked in. Nevertheless, there was a lot of action-packed in the four days.

Investor sentiment has largely been weighed down by the Federal Reserve's outlook even as it talks of interest rate hikes in 2022 and the potential impact of increasing cases of the Omicron variant on the yet-to-recover global economy.

Here is the weekly market recap for stocks, gold, oil, and bitcoin.

S&P 500 soars in pre-Christmas rally

US stocks rallied on Thursday, major gains across the indexes seeing the S&P 500 close at a record, while the Dow and the Nasdaq Composite also edged higher ahead of the Christmas holiday.

The highlight on Wall Street was the S&P 500, which soared 2.3% in the week to 4,726 to ink an all-time high and bring year-to-date gains to 25.8%. Fundstrat’s Tom Lee sees the gains growing by at least 11% to 5,100 by the end of 2022 and by 313% by 2029.

There were also gains for the Dow as it closed near 35,952, which is 1.7% high over the past week and nearly 18% YTD. Meanwhile, the Nasdaq Composite moved 0.85% to close at 15,653, which was 3.2% in the green over the week and now over 21% YTD.

Among sectors, consumer discretionary and information technology all notched over 3.0% even as S&P 500 saw top gainers in Tesla Inc (+5.8%), ViacomCBS (+4.8%) and Micron Technologies (+4.5%).

European stocks close the week higher

In Europe, the week to Christmas also came with a decent bounce for stocks as investors looked to string another rally ahead of the final week of the year.

The pan-European Stoxx 600 index edged +1.4% over the week, while Germany’s DAX rose 0.77% and France’s CAC 40 rallied 1.5%. The UK’s FTSE 100 also climbed 1.6% over the shortened week.

Gold holds above $1,800

Gold prices held above $1,800 this week, although the price of the precious metal remained largely constrained by a market buoyed by good news on the Omicron front.

After breaking above $1,800 per ounce earlier in the week, spot gold rose to $1,813 per ounce before an improving dollar and risk-on appetite among investors saw the precious metal decline towards the closing bell.

According to one analyst, gold will be the best performer in 2022, with targets near $3,000. Gareth Soloway stated in a recent interview that inflation could be the key to gold soaring, adding:

“Ultimately you have to look at the inflation numbers because it’s not going back to the 2% level. The fed will taper, but ultimately people will rotate into gold.”

Spot gold closed at +0.1% on Thursday, with prices at $1,810.20 per ounce.

Oil prices steady

Oil prices traded relatively steady over the week, with the market reacting to reduced supply headlines as well as reports that the Omicron variant could prove more contagious than previously thought.

Brent crude futures rose 2.07% to $77.68 per barrel while the US West Texas Intermediate (WTI) crude futures moved up 1.4% to $74.79 per barrel on Thursday.

Bitcoin tops $51,000

Ahead of the holiday weekend, it wasn’t just stocks that were raring for a Santa Claus rally, cryptocurrency’s leading asset Bitcoin (BTC) also showed remarkable bounceback as it broke above $50,000 for the first time in two weeks.

The price of Bitcoin soared to break another barrier at $51,000, racing to $51,792 before slowing. the upside mirrored broader market gains.

Bitcoin is up more than 70% year-to-date and despite struggling since touching the record price at $69,000, it’s still over 170% up since early December 2020.

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