By Damian J. Troise, The Associated Press on December 27, 2023.
NEW YORK (AP) – Wall Street drifted to a slightly higher close as trading remained light on this holiday-shortened week. The S&P 500 edged up 0.1% Wednesday. The Dow rose 0.3% and the Nasdaq rose 0.2%. Markets are holding on to modest gains for the week so far, and the S&P 500 is coming off its eighth straight winning week. With just two more trading days left in the year, major indexes are on track to post hefty annual gains. The S&P 500 is up more than 24% for the year, while the Nasdaq, which is heavily weighted with technology companies, is up 44%.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
NEW YORK (AP) – Stocks drifted on Wall Street Wednesday as trading remains relatively light ahead of the New Year holiday.
The S&P 500 fell 0.1%. The Dow Jones Industrial Average rose 32 points, or 0.1%, as of 2:43 p.m. Eastern. The Nasdaq composite was relatively unchanged. Markets are holding on to small gains for the week so far. The S&P 500 is coming off its eighth straight winning week.
Losses for some big technology companies weighed down the broader market. Microsoft fell 0.4% and Google’s parent company, Alphabet, slipped 1%.
A mix of retailers and auto-related companies were among the biggest gainers. Tesla jumped 1.9% and Costco rose 1%.
Markets in Europe and Asia gained ground.
Bond yields fell. The yield on the 10-year Treasury fell to 3.79% from 3.90% late Tuesday.
Several biotechnology companies made big moves after giving investors updates on drug development. Cytokinetics surged 75.5% on an encouraging study update for a potential heart condition treatment. Iovance Biotherapeutics shed 20.8% after pausing a study on a potential lung cancer treatment because of a possible safety issue.
The New York Times rose 2.1% after filing a federal lawsuit against OpenAI and Microsoft, seeking to end the practice of using its stories to train chatbots.
With just three days left in the year, major indexes are on track to post hefty annual gains. The S&P 500 is up 24% for the year, while the Nasdaq, which is heavily weighted with technology companies, is up 44%.
The latest two-month rally for the broader markets has left the benchmark S&P 500 hovering just below its all-time high set in January of 2022.
“Consistent buying pressure of this magnitude is not only rare but a bullish sign for improving investor sentiment and market momentum,” said Adam Turnquist, chief technical strategist for LPL Financial, in a note to investors.
The final week of 2023 lacks any big economic updates. Overall, investors have been encouraged by reports showing inflation is on the decline even as the economy appears stronger than expected. The Federal Reserve is walking a tightrope, seeking to slow the economy enough through high interest rates to cool inflation, but not so much that it tips the nation into recession.
Inflation slowed to a rate of 2.6% in November, according to a measure closely followed by the Fed. That’s down from 7.1% in the middle of 2022 and edging closer to the central bank’s target of 2% inflation. U.S. economic growth has been steady since contracting in the middle of 2022 and sharply accelerating in the third quarter of 2023.
The data have raised hopes that the economy will likely avoid a recession, or at least avoid a significant one. They have also encouraged Wall Street to bet that the Fed is done raising interest rates and will likely shift to rate cuts in the new year. The central bank has held rates steady since its meeting in July, and Wall Street expects it to start cutting rates as early as March.