Is Market Open Today, The Day After Christmas?

U.S. markets will remain closed on Monday as an observed holiday for Christmas.

What Happened: Last week, major indices posted mixed performance while missing the much-awaited Santa Claus rally. The Nasdaq Composite lost 1.96% in the last five days while the Dow Jones ended 0.86% higher. The S&P 500 shed 0.23% in the same period.

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The SPDR S&P 500 ETF Trust SPY lost 0.15% in the last five days while the Vanguard Total Bond Market Index Fund ETF BND shed 1.19% in the same period.

The only relief came on Wednesday when markets soared following the release of an upbeat consumer confidence data that surged to an eight-month high in December in the backdrop of a drop in inflation and a strong labor market. Twelve-month inflation expectations fell to the lowest level since September 2021, at 6.7%.

Recession Fears: Despite the consumer confidence data bringing a minor relief, the market remains awash with expectations of recession while hopes of a soft landing have started losing momentum. Prominent names have argued that a recession may be inevitable.

Former Treasury Secretary Lawrence H. Summers expects the Federal Reserve will have to suffer through a recession if inflation was to come down and that the recession will not be a mild one.

Allianz chief economic adviser Mohamed El-Erian noted last week that the effect of the central bank’s rate hikes is showing up in rate-sensitive sectors of the economy but the challenge is that drivers of inflation have shifted.

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