U.S. stocks saw a rise on Tuesday, aiming to bounce back from a rocky beginning to December that included considerable losses on both Wall Street and in the cryptocurrency sector.
The S&P 500 (^GSPC) gained 0.2%, while the tech-focused Nasdaq Composite Index (^IXIC) was up approximately 0.6%. The Dow Jones Industrial Average (^DJI) rose by 0.4%.
After a rough start, stocks appear to be recovering, shaking off the cautious sentiment that characterized Monday’s trading, which saw the three main U.S. indexes end a five-day winning streak. Typically, December is a strong month for the market, making the recent dip particularly noteworthy and sparking discussions about the likelihood of a “Santa Claus rally.”
On a positive note, Bitcoin (BTC-USD) surged above $91,000, breaking out of a weeks-long slump. On Monday, it hit an all-time low of $84,000, its worst day since March. In addition, shares of cryptocurrency-focused companies like Coinbase (COIN) and Robinhood (HOOD) began to rise after falling the previous day.
Investors are currently pondering what might drive a return to a year-end bull market, even as challenges like persistent inflation, high market valuations, and ongoing uncertainties related to substantial AI investments linger.
Attention is also on economic indicators, particularly with a delayed government report being released that could influence expectations for a potential interest rate cut in December. Hopes were maintained on Monday despite concerns that tariffs might affect U.S. manufacturing activity.
Expectations for less stringent monetary policy are climbing ahead of next week’s two-day central bank meeting. The market has now priced in an 87% chance of a rate cut on December 10, a figure that has risen significantly since mid-November.
There aren’t any major updates lined up for Tuesday as anticipation builds for this week’s essential release of the Fed’s consumer inflation index for September.
On the earnings front, Marvell (MRVL) is set to report its financial results after the market closes. Following reports of discussions to acquire semiconductor startup Celestial AI in a multibillion-dollar deal, shares of U.S. chipmakers gained traction. Companies like CrowdStrike (CRWD) and Okta (OKTA) were also notable on Tuesday.
