In this photo provided by the New York Stock Exchange, specialist James Denaro works at his post on the trading floor.
U.S. stocks climbed on Monday, kicking off a holiday-shortened week with broad gains. Technology companies and banks drove the rally, while industrials also contributed strongly.
The S&P 500 gained 43.99 points, or 0.6%, closing at 6,878.49. The Dow Jones Industrial Average rose 227.79 points, or 0.5%, to 48,362.68. The Nasdaq composite added 121.21 points, or 0.5%, reaching 23,428.83.
Small-Cap Stocks Shine
Smaller companies outperformed major indexes, with the Russell 2000 surging 1.2%. These gains pushed indices deeper into monthly winning territory, despite a volatile December.
Tech stocks, particularly those focused on artificial intelligence (AI), remain the key driver. Their performance will likely determine whether Wall Street closes the year with positive returns.
Chris Larkin, managing director at E-Trade from Morgan Stanley, noted:
"If a Santa Claus rally does kick in this year, St. Nick’s gift bag will likely need to be full of positive tech sentiment."
Tech and Banking Lead the Way
Nvidia, a major tech driver this year, rose 1.5%. JPMorgan led banking gains with a 1.9% increase.
Ride-hailing companies also surged. Uber gained 2.5% and Lyft rose 2.7% after announcing plans to launch robotaxi services in London next year.
Media and entertainment stocks saw notable moves. Paramount Skydance jumped 4.3% after enhancing its hostile takeover bid for Warner Bros. Discovery, backed by an irrevocable guarantee from Larry Ellison. Warner Bros. Discovery rose 3.5%, while Netflix slipped 1.2%.
Energy and Commodities Movement
Dominion Energy fell 3.7% after the Trump administration paused leases for five large-scale offshore wind projects, including its Coastal Virginia Offshore Wind initiative.
Precious metals and oil experienced gains. Gold surged 1.9% to $4,469.40, while silver rose 1.6%. U.S. crude oil increased 2.4% to $58.01 a barrel, and Brent crude climbed 2.6% to $62.07 per barrel following reports of another sanctioned oil tanker in the Caribbean.
Bond Market and Global Indexes
Treasury yields edged higher, with the 10-year Treasury rising to 4.16% from 4.15% late Friday.
Globally, Asian markets advanced while European stocks slipped. U.S. markets will close early Wednesday for Christmas Eve and remain closed Thursday for Christmas Day.
Economic Reports in Focus
Several key reports are scheduled this week. Tuesday brings the first estimate of third-quarter GDP, offering insight into economic performance. The Labor Department will release weekly jobless claims on Wednesday, a proxy for layoffs.
The Conference Board’s December consumer confidence survey also releases Tuesday, providing insights into sentiment amid rising inflation and slowing retail sales.
Inflation, Jobs, and Federal Reserve Policy
Last week’s data highlights ongoing inflation pressures and a weaker job market. Retail sales have softened, and consumers remain concerned about prices.
The Federal Reserve has cut interest rates at its last three meetings to support economic growth amid slowing employment. While rate cuts aim to stimulate activity, they risk fueling inflation.
Wall Street anticipates the Fed will likely hold rates steady at its January meeting, balancing inflation concerns against labor market weakness.
Market Outlook
Investors remain cautious but optimistic as the year nears its end. Technology, banks, and energy stocks will continue to shape short-term gains. A Santa Claus rally remains possible, provided tech sentiment stays positive and economic reports support steady growth.
