U.S. stock indexes were trending higher in early trading Tuesday as Wall Street ended the year with another milestone-breaking rally.
The S&P 500 rose 0.2%. The benchmark index is coming off a streak of more than 1% decline.
As of 9:56 a.m. ET, the Dow Jones Industrial Average was up 120 points, or 0.3%. The Nasdaq Composite rose 0.1%.
More than 85% of S&P 500 stocks rose in value. Healthcare stocks and financial stocks were the biggest boosters. AbbVie rose 0.7% and JPMorgan Chase rose 0.5%.
Bond yields have mostly fallen. The yield on the 10-year U.S. Treasury note fell to 4.52% from 4.54% late Monday. The two-year bond yield fell to 4.22% from 4.24%.
Crude oil prices rose 0.5%.
European indices generally rose. Asian markets were mixed, with exchanges in Tokyo and Seoul closed for the year-end and New Year holidays.
Despite a small post-Christmas slump, major U.S. stock indexes are on pace to end the year with strong gains.
The S&P 500 Index, which set 57 new all-time highs in 2024, is up more than 24% for the year, marking the first time since 1998 that it has risen more than 20% in consecutive years.
The Nasdaq rose 30% and the Dow rose 13%.
The strong performance of the US market this year has been driven by economic growth, strong consumer spending and a strong job market.
Rising prices for companies in the artificial intelligence business such as Nvidia and Super Micro Computer have taken the market to new heights.
Strong corporate earnings growth also contributed. Wall Street expects S&P 500 companies to report broad-based earnings growth of more than 9% annually, according to FactSet. The final numbers will be compiled following the fourth-quarter report, which begins in the coming weeks.
This was another tailwind for the market. Many on Wall Street feared the inevitable after the Federal Reserve raised its key interest rate to the highest level in 20 years in hopes of slowing the economy to beat high inflation. Recession was averted.
Reversing inflation, which is nearing the Fed's 2% target, has helped buoy Wall Street, with the Fed expected to cut rates several times over the next year, thereby easing borrowing costs and spurring further economic growth. Expectations were high.
However, after 3 o'clock interest rate reduction In 2024, the Fed signaled a more cautious approach for 2025. Inflation remains sticky This comes as the country prepares for President-elect Donald Trump's inauguration into the White House. Trump's threat of increased tariffs Rising prices of imported goods are raising fears that inflation could flare up again as companies pass on higher costs from tariffs.
This year's market rally wasn't just limited to stocks. Bitcoin, which was below $17,000 just two years ago, has surpassed $100,000 for the first time. And gold also broke records, rising more than 26% this year.
The market will be closed on Wednesday due to New Year's Day. On Thursday, investors will get the latest snapshot of U.S. construction spending in November. On Friday, Wall Street will receive an update on manufacturing for December.
