The trading scene on Tuesday exhibited a lukewarm demeanor, marked notably by the vigor of technology stocks both in Europe and the United StatesThis surge powered the U.Smarkets to streak resiliently, delivering a robust rebound that lasted for a second consecutive day, while European stocks managed to firm slightlyThe S&P 500 index, a key benchmark for U.Sequity performance, has gained an impressive 1.8% this week, and the Dow Jones Industrial Average (DJIA) has climbed by around 1%. The Nasdaq Composite, heavily laden with major tech shares, surged even higher, posting a commendable 2.3% uptickAs a result of this week’s progress, the S&P 500 has continuously erased earlier losses accrued in the month, now flirting with a marginal gain of 0.1%. Interestingly, the Nasdaq is positioned for a notable 4.2% increase this December alone, with giants like Google, Apple, and Tesla leading the charge—boasting increases of 16%, nearly 9%, and approximately 34%, respectively

Meanwhile, the Dow finds itself in a contrasting position, showing a decline of about 3.6% this month, indicative of its worst monthly performance since April this year.

LPL Research's data serves as a cold reminder that tradition often leads to tangible results in the stock marketSince the year 1950, the final five trading days of the year combined with the first two trading days of the new year—often coined the “Santa Claus rally” period—has seen an average return of 1.3%. This figure overshadows the average seven-day market return of just 0.3%. Significantly, the onset of this year’s Santa Claus rally was marked on Tuesday, setting optimistic expectations for the markets ahead.

A glimmer of hope flickers in Australian markets as the Reserve Bank of Australia revealed in its meeting minutes a keen proximity to potential interest rate cutsTheir growing confidence in controlling inflation, however, is tempered by the caution against premature victory announcements following the decision to maintain interest rates at thirteen-year highs during December’s assembly

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The South Korean political landscape, meanwhile, appears tumultuous as the opposition party seeks to initiate impeachment proceedings against Acting President Han De-suPolitical unrest has stimulated a mass exodus of foreign investors from the South Korean stock market, witnessing net sell-offs exceeding 30 trillion won over the last thirteen trading days, sending the won spiraling closer to fifteen-year lows.

As Christmas Eve approached, the American stock market exhibited a vigorous rebound, breathing life back into investor sentiment as trading acceleratedVolatility sharply diminished, bringing about a delightful atmosphere that culminated in many major indices reaching new daily highsTesla, in particular, contributed significantly with gains surpassing 7%, alongside a broad uplift among technology and semiconductor stocks, propelling the Nasdaq index forward with a 1.35% hikeAmidst this backdrop, an unfortunate technical glitch grounded all domestic flights by American Airlines on one of the year’s busiest travel days, although operations resumed shortly thereafter, allowing their stock price to recover.

On the whole, the primary indices from the U.S

all showcased impressive gainsThe S&P 500 index wrapped up the day with a 1.1% uptickThe Dow Jones, known for its economic sensitivity, rose by 390 points or 0.91%, closing at 43,297.03. Similarly, the tech-heavy Nasdaq Composite rose by 1.35%, and the Nasdaq 100 climbed by 1.37%. The Nasdaq technology market capitalization-weighted index displayed a 1.16% improvement, as the Russell 2000 small-cap index followed suit, gaining 1%. The volatility index, VIX, saw a descent of 14.96%, closing at 14.27. This consistent ascent across major U.Sindices fostered an optimistic market climate, with all industry exchange-traded funds (ETFs) echoing this robust performanceThe consumer discretionary ETF, in particular, surged over 2.3%, leading the sector gains.

A noticeable bullish trend permeated AI-related stocks as wellWhile Serve Robotics experienced a setback, dropping 4.01%, stocks like Palantir and CrowdStrike saw increases of 2.09% and 1.19%, respectively, while Super Micro Computer appreciated by 5.96%. It demonstrated the continued investor enthusiasm around the artificial intelligence narrative that seems to sustain momentum across various technology sectors.

Across the Atlantic, the European trading scene mirrored the U.S

rally, as tech and mining stocks took the leadNovartis saw a continuation of its upward trend, seeing a 5.7% increase that buoyed market spiritsHowever, trading was muted as key markets in Germany, Italy, Greece, Denmark, and Brazil were on holidayThe pan-European STOXX 600 index edged up by 0.18%, closing at 503.81 points, while the Eurozone’s STOXX 50 index added 0.1% to its tallyFrance’s CAC 40 index and the UK’s FTSE 100 index ticked up by 0.14% and 0.42%, respectivelyNotably, Spain's IBEX 35 managed a modest increase of 0.33%.

Nicholas Brind from Polar Capital Global Financial Trust has forecasted that 2024 will witness European bank mergers exceeding $41.5 billion, marking the most bustling period since 2020, which is anticipated to spur bank stock performance substantiallyWith financial firms represented in 17% of European M&A deals, the expectation is that robust amalgamation activity will persist into 2025 due to management teams carrying ample cash reserves, eager to invest or execute stock buybacks.

The long-term U.S

Treasury yield touched a seven-month peak of over 4.6% during intraday trading but later retreated slightly by the closeThe yield on the two-year U.STreasury remained relatively stable at around the 4.33% to 4.363% rangeSimilarly, the 30-year Treasury yield also peaked for the first time since April but reverted into minor losses by the end of the dayOver in Europe, the UK’s 10-year Treasury yield climbed by 2.9 basis points to 4.575%, and the two-year yield saw a gain of 2.8 basis points.

The U.Sdollar index made a slight upward move, creeping closer to a two-year peak amidst expectations that the Federal Reserve will likely slow its pace of interest rate reductions compared to other global central banksSince the end of September, dollar strength has accumulated to over 7%. On another note, the euro fell against the dollar, down 0.15% at 1.0389, nearing its two-year low, while the British pound faltered slightly, down 0.06% to 1.2527. The Japanese yen faced a momentary rally breaking above 157 but ultimately declined as the day closed

Analysts believe that the present exchange rate for the yen favors foreign investments into Japanese equitiesMeanwhile, the cryptocurrency market notably thrived, led by Bitcoin, which soared past $99,000, reflecting a more comprehensive resurgence in the realm of digital currencies.

In the backdrop of the Christmas holidays, the trading volume remained subdued, yet the short-term market outlook seemed slightly optimisticThis sentiment lifted international oil prices from their prior declines, with West Texas Intermediate (WTI) crude oil pricing striving past the $70 markWTI February crude futures closed up by $0.86, translating to a rise of over 1.24%, settling at $70.10 per barrelSimilarly, Brent crude oil futures for February saw a rise of $0.95, or approximately 1.31%, ending at $73.58 per barrelNatural gas also saw an uplift with January futures climbing 7.93%.

As the market gears up for the Christmas festivities, gold maintained a steady course