The stock market is poised to see further gains this week as traders return following the Christmas holiday seeking a strong end to the year.
Here’s an update
The broader stock market closed higher last week and a new rally for the major indexes is likely. US futures are however mixed, with the Dow down 0.03% while the S&P 500 futures and Nasdaq futures are marginally up.
European equities are edging higher on Monday, with the European Stoxx 600 index up 1.2%, and the DAX +0.04. The French CAC 40 is up 0.15 while Italy’s FTSEMIB has added 0.28%. Britain’s FTSE 100 continues to hold near support, about 0.02% down.
In commodities, gold is holding near $1,810 per ounce, although there’s pressure as the dollar firms and stocks pick up an upside. Meanwhile, oil is down 1.3% at $72.78 per barrel.
Currencies have the Dollar index up 0.2% to 96.21, while the Sterling continues to hold firm against the greenback at $1.134 with +0.12%. The Euro is struggling near 1.131, about 1.12% down against the US dollar.
In cryptocurrencies, the total market capitalisation is up 2.3% after a weekend of gains across the market. Bitcoin continues to hold above $50,000, while Ether is above $4,000.
What to watch out for this week: Santa rally and Omicron news
There are no major economic data releases and earnings reports this week, but here’s what investors could be interested in over the next five days.
Santa Claus rally
The week is largely going to be dominated by investor sentiment about the historical rallies that come during the last few days of the trading year, known as the Santa Claus Rally.
Historically, the stocks have gained an average of 1.33% every time Santa comes to the market, doing so about 79% of the time.
Notably, though, analysts have noted decreased returns in the near term whenever the markets has failed to rally over this period, with highlights being the bear markets of 2000 and 2008.
While a missed Santa Claus rally might signal a bearish turn early in the year, another factor likely to be at play and one to watch out for is the current concerns regarding the Omicron variant. The strain is reportedly milder than previously thought, but it’s proving highly contagious. The market has bounced on the back of Omicron news and this could yet occur this week.