Wall St edges up as year end approaches, S&P nears record closing high
By Shubham Batra and Amruta Khandekar
(Reuters) -U.S. stocks rose marginally in light trading on the penultimate trading day of 2023, with the S&P 500 within a close range of its all-time high on hopes of early interest rate cuts from the Federal Reserve next year.The benchmark index rose to as much as 4,793.30 points earlier in the session, coming within a whisker of breaching its January record close of 4796.56.
If it crosses the mark, that would confirm the bellwether index has been in a bull market after it hit the bear market closing trough in October 2022.
U.S. equities have managed to extend their rally into the final stretch of 2023, even in the absence of any major market moving catalysts. The three main indexes are on course for monthly, quarterly, and annual gains.
Optimism around early rate cuts, a possible soft landing for the American economy, and the artificial intelligence frenzy powered stellar gains on Wall Street this year.
The tech-heavy Nasdaq 100 is also on track to log its best year since 1999.
«I do think for the near term the momentum will continue to move this market higher,» said Victoria Fernandez, chief market strategist at Crossmark Global Investments.
However, Fernandez pointed to risks in the longer term, saying «inflation will continue to fall, but probably not as quickly as the market is anticipating.»
Money markets have priced in an about 88% probability that policymakers will reduce the Fed funds target rate by at least 25 basis points at the conclusion of their March policy meeting, according to CME Group's (NASDAQ:CME) FedWatch tool.
The Labor Department's report on Thursday indicated a weakening jobs market, supporting the rate-cut narrative. Initial claims for state unemployment
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