TIAA Global Asset Management

Equity market rally losing steam ahead of Christmas holiday

William Riegel, Chief Investment Officer, TIAA Investments

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December 22, 2016

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Equity and fixed-income markets

Equity markets began the week on a positive note amid seasonally light trading. The S&P 500 Index climbed to within a point of its all-time high set on December 13 before moving lower. Investors still harbor hope for a so-called “Santa rally”—a rise in stock prices that is often observed in the week between Christmas and New Year. Overseas, Europe’s STOXX 600 Index and Japan’s Nikkei 225 Index both lost ground after notching 2016 highs.

In fixed-income markets, the yield on the bellwether 10-year U.S. Treasury declined from the prior week. For the year to date through December 21, the 10-year yield has risen 28 basis points (0.28%). Since closing at an all-time low of 1.37% on the heels of late June’s Brexit vote, however, it has surged 90 basis points (0.90%). The yield on the 2-year note, which on December 18 reached its highest level since 2009, also fell.


Article Highlights

Current updates to the week’s market results are available here.

GDP is revised higher in a mixed week for U.S. economic data

A number of U.S. data reports were released in the days leading up to Christmas. Among these:

Another abbreviated edition of the Weekly Market Update will be produced before year-end, with our normal publishing schedule to resume on Friday, January 6.

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