Closing Stock Market Summary
The stock market closed with gains this session amid the Santa Claus rally period, which includes the last five trading days of the year and the first two trading days of the new year. Participation was below-average to begin this holiday shortened week due to investors remaining in vacation-mode ahead of another extended holiday weekend.
The three major indices closed with gains ranging from 0.4% to 0.5% after taking a modest turn lower in the last 30 minutes of trading. The Russell 2000 was a relative outperformer among major indices, climbing 1.2%. The S&P 500 for its part traded within 15 points of its all-time high close (4,796) at its high of the day.
Gains were relatively broad based. The Invesco S&P 500 Equal Weight ETF (RSP) climbed 0.6%; the Vanguard Mega Cap Growth ETF (MGK) rose 0.3%; and the Russell 3000 Growth Index rose 0.4% and the Russell 3000 Value Index rose 0.6%.
In addition to the seasonality factor, today's positive bias was supported by some M&A buzz in the biotech industry. Bristol-Myers (BMY 51.45, -0.84, -1.6%) is acquiring RayzeBio (RYZB 61.40, +30.83, +100.9%) for $62.50 per share in cash, which is a 104% premium over Friday's closing price, and AstraZeneca (AZN 66.50, +0.21, +0.3%) is acquiring Gracell Biotechnologies (GRCL 9.92, +3.73, +60.3%) for an upfront cash portion of $10.00 per ADS, which is a 62% premium over Friday's closing price.
The aforementioned headlines garnered attention due to the premiums being paid rather than the size of the deals.
All 11 S&P 500 sectors settled with gains. The health care sector (+0.2%) saw the slimmest gain while the energy sector (+0.9%) settled at the top of the leaderboard, rising alongside oil prices ($75.66/bbl, +2.04, +2.8%). The move in oil was related to geopolitical angst tied to a weekend report that an oil tanker near India was struck by an Iranian drone.
The 2-yr note yield settled two basis higher at 4.35%. The 10-yr note yield declined two basis points to 3.89%. On a related note, today's $57 billion 2-yr note sale was met with solid demand.
- Nasdaq Composite: +44.0%
- S&P 500: +24.4%
- Russell 2000: +16.9%
- S&P Midcap 400: +15.6%
- Dow Jones industrial Average: +13.3%
Reviewing today's economic data:
- October FHFA Housing Price Index 0.3%; Prior was revised to 0.7% from 0.6%
- October S&P Case-Shiller Home Price Index 4.9% (consensus 5.0%); Prior 3.9%
Looking ahead, there is no US economic data of note on Wednesday.