US benchmark equity indexes ended lower on the final trading day of the year, yet they recorded remarkable double-digit percentage gains for the year. The Nasdaq Composite fell by 0.9%, reaching 19,310.8, while the S&P 500 declined by 0.4% to close at 5,881.6. The Dow Jones Industrial Average saw the smallest drop of just 0.1%, settling at 42,544.2. The year 2024 proved to be favorable for the markets, with the Nasdaq surging nearly 29%, the S&P 500 increasing by 23%, and the Dow enjoying a 13% rise.
Earlier in December, all three indexes achieved all-time high closing levels, reflecting strong investor confidence. D.A. Davidson emphasized the positive investor sentiment as we approach 2025, citing that several of the favorable trends from 2024 were strengthened by the November (US presidential) election results.
This has fostered expectations for pro-growth policies. "This environment sets up for equity prices to potentially rise, provided the US economy maintains a growth rate above 2% and corporate earnings exceed 10%," noted D.A. Davidson in a recent communication to clients. Financial markets will observe a closure on Wednesday in observance of New Year's Day. Examining sector performance, the technology sector experienced the most significant downturn on Tuesday, while energy sectors reported gains. In government bond news, the US 10-year yield progressed by 2.8 basis points to settle at 4.57%, while the two-year rate saw a slight decline of 1.4 basis points to 4.24%. From an economic perspective, US home prices have climbed to new record levels in October, despite an annual price growth slowdown, as reported by S&P Global's division, S&P Dow Jones Indices.
Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices, remarked, "Our national index has exhibited continued enhancement with data preceding the presidential election. The elimination of political uncertainty has catalyzed a rally in the equity markets; it will be significant to observe if a similar trend manifests among homeowners." Additionally, the Federal Housing Finance Agency indicated a 0.4% increase in home prices on a seasonally adjusted basis for October, contrasted with the previous month’s steady gain of 0.7%.
This latest figure aligns with consensus expectations drawn from a Bloomberg survey. The housing market confronts similar challenges as it enters 2025, dealing with mortgage rate fluctuations and seasonal trading underperformance as highlighted by Wedbush Securities in their client communications. In December, Texas' service sector activity saw a decline even while a critical revenue indicator heightened, according to the Federal Reserve Bank of Dallas. In commodity markets, West Texas Intermediate crude oil experienced a rise of 1.2% to $71.82 a barrel. In corporate news, Sangamo Therapeutics's shares plummeted by 56%.
The genomic medicine firm announced late Monday that their partner, Pfizer, opted not to advance the development of a new gene therapy targeting hemophilia A. Despite the negative news for Sangamo, Pfizer's shares closed 0.4% higher on Tuesday. Grail's shares saw a dip of 4.2%, marking the second most significant drop on the Nasdaq.
Conversely, Moderna emerged as the top performer on the S&P 500, rising 5.6%. Chinese e-commerce entity PDD saw its US-listed shares increase by 2.8%, making it the top gainer on the Nasdaq. In precious metals trading, gold ascended by 0.8%, reaching $2,638.70 per troy ounce, whereas silver declined by 0.4% to $29.28 per ounce..