11 days in a row with more decliners than advancers on the S&P 500, ties longest streak since 1990.
Many claim this is bearish, but is it?
Looking at the longest streaks ever actually appears to be rather bullish. Significant outperformance across the board out one year.
— Ryan Detrick, CMT (@RyanDetrick) December 17, 2024
The Dow Jones Industrial Average fell for an eighth straight session on Monday, marking its longest losing streak since 2018. The index declined by 110 points, or 0.3%. In contrast, the Nasdaq Composite rose by 1.2%, setting a record close for the 38th time this year.
The S&P 500 also gained 0.4%, despite having negative breadth for the 11th consecutive session.
Dow down 7 days in a row, but only 2.6% off the all-time highs (third least ever).
I see 78 7-day losing streaks since 1900 and an avg of 24.7% off ATHs.
— Ryan Detrick, CMT (@RyanDetrick) December 15, 2024
Energy stocks were the biggest laggards in the market, with companies such as Marathon Petroleum and Phillips 66 among the worst-performing stocks in the S&P 500. Healthcare stocks also struggled, including UnitedHealth, which has been a significant drag on the Dow this month.
December @SPGlobal U.S. Manufacturing PMI down to 48.3 vs. 49.5 est. & 49.7 prior; Services up to 58.5 vs. 55.8 est. & 56.1 prior; Composite up to 56.6 vs. 55.1 est. & 54.9 prior pic.twitter.com/HPGKnDNOHv
— Liz Ann Sonders (@LizAnnSonders) December 16, 2024
Traders are anxiously awaiting the Federal Reserve’s rate decision, set to be announced on Wednesday at the conclusion of the central bank’s final 2024 two-day policy meeting. A 95% chance of a quarter-point cut is being priced in according to market indicators. Federal Reserve Chair Jerome Powell’s insights into future policy moves during the post-meeting press conference remain critical focal points for Wall Street.
Dow falls amid anxious market sentiment
Adam Crisafulli of Vital Knowledge noted that initial enthusiasm over Donald Trump’s re-election is waning. “The market’s mood has been deteriorating, with investors increasingly concerned about poor breadth and shifting focus away from Trump’s virtues like deregulation and tax relief, towards potential headwinds such as higher deficits and tariffs,” Crisafulli wrote.
According to Hubert de Barochez, a senior economist at Capital Economics, the failure of German Chancellor Olaf Scholz’s government in a parliamentary vote and the tentative February elections pose additional headwinds for euro-zone equities. “The German DAX index has climbed 22% so far in 2024, but a new report highlights that adverse conditions such as political uncertainty and weak growth might take a toll next year,” de Barochez wrote. State Street’s macro multi-asset strategist Cayla Seder suggests that commentary on inflation risks and potential unemployment rises might be more influential than the dot projections themselves in the Federal Reserve’s upcoming decision.
“The more interesting output from the meeting could be commentary about how the central bank views risks,” Seder mentioned. Stock futures opened with little change on Monday evening. Futures tied to the Dow dipped 45 points, or 0.1%.
S&P 500 futures edged down 0.1%, while Nasdaq 100 futures hovered near the flatline.
