Wall St eyes lower open as holiday-shortened week draws to a close
By Medha Singh and Purvi Agarwal
(Reuters) -Wall Street’s main indexes were set for a lower open on Friday at the end of an upbeat holiday-shortened week driven by expectations around a traditionally strong period for markets.
Yields on U.S. Treasury notes were higher on the day, with the ones on the benchmark 10-year note hovering near an over seven-month high it hit on Thursday. It was last at 4.595%.
At 08:32 a.m. ET, Dow E-minis were down 175 points, or 0.40%, and E-minis were down 25 points, or 0.41%.
Futures tracking the tech-heavy were down 93.75 points, or 0.43%, as Nvidia (NASDAQ:) dropped 0.6% in premarket trading and Tesla (NASDAQ:) shed 0.8%.
“It feels like U.S. equity markets and investors here are tepid heading into the end of the year. Nobody wants to be making any major moves before 2025 when the new administration comes in,” said Clayton Allison, portfolio manager at Prime Capital Financial.
The S&P 500 has recovered most of last week’s losses that stemmed from the U.S. Federal Reserve projecting fewer interest rate cuts in 2025 and hurting risk appetite.
The benchmark index is now eyeing its best week in seven, and is about 1% below its all-time high of 6,099.97 points clinched on Dec. 6.
With three sessions left to close out the year, investors are hoping for new all-time highs in the stock-buying season called the “Santa Claus rally” – the last five sessions of December and the first two of January.
Since 1969, the S&P 500 has climbed 1.3% on average in the seven-day trading period, according to the Stock Trader’s Almanac.
“If yesterday is any indication, we are kind of starting off not great on a Santa rally. I feel like we got a lot of it post-election… today is going to give us a pretty good indication but it feels like more market participants are pretty cautious,” said Allison.
U.S. equities have broadly extended their gains from a stellar November, when Donald Trump won the U.S. presidential election, as hopes of pro-business policies under the incoming administration stoked optimism.
Trading volumes in this holiday-shortened week have been below the average of the last six months and are likely to remain subdued until Jan. 6. The next major focus for markets will be the December employments report due on Jan. 10.
Among individual movers, Amedisys (NASDAQ:) gained 4.4% after the home health service provider and insurer UnitedHealth (NYSE:) extended the deadline to close their $3.3 billion merger.
On Thursday, the Dow closed higher in thin year-end trading, recouping some losses from its recent ten-session losing streak, while higher U.S. Treasury yields weighed on some heavyweight tech and growth stocks.
