The US stock market saw a significant surge on Friday, with major indexes like the S&P 500, Nasdaq, and Dow Jones Industrial Average closing in the green. This uptrend was largely driven by a rebound in technology shares, which offset the decline in consumer stocks such as Nike. The Philadelphia SE Semiconductor index jumped 3.1%, with Micron Technology reaching a record high, up 7.4%, and Nvidia rising 3.3%.
The US market has traditionally been strong in December, with the so-called Santa Claus rally resulting in an average gain of 1.3% for the S&P 500 over the last five trading days of the year and the first two trading days in January. This trend is expected to continue, with the S&P 500 gaining 0.89%, the Nasdaq Composite rising 1.17%, and the Dow Jones Industrial Average increasing 0.57% on Friday.
Some of the key winners on Friday included Oracle, which jumped 7.6% after TikTok's Chinese owner, ByteDance, signed binding agreements to hand control of the short-form video app's US operations to a group of investors, including the cloud computing giant. On the other hand, Nike shares slumped 10.9% after the sportswear giant reported a drop in gross margins for the second consecutive quarter.
Analysts warned of higher volatility on Friday due to triple witching, which is the quarterly, simultaneous expiration of stock options, stock index futures, and stock index options contracts. Additionally, traders continued to bet on at least two 25-basis-point interest rate cuts next year from the Federal Reserve, with a 20% chance of the first reduction as early as January.
Remember, this is just a perspective and not a prediction. It's essential to do your own research and consider multiple sources before making any investment decisions.
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