Dow closes higher on first day of 2026, still no Santa Claus rally
By Saeed Azhar, Purvi
Agarwal and Nikhil
Sharma
Fri January 2, 2026 4:33 PM
Tech started well in the black this morning but then began an almost immediate pullback spending most of the rest of the session modestly in the red. Industrials on the other hand started in the red and quickly catapulted into the black, the Dow closing with a handsome 3-digit gain while the other two basically just broke even. The Santa Claus Rally has more or less been declared dead after having a first few very good days, But uncertainty over the economy and the future of AI put a damper on it this year, though ironically today in particular was a very good day for AI, chips being up 4%.
With the expectation of a more dovish Fed Chair, investors hope for more rate cuts but all eyes next week will be on the labor numbers to see if inflation remains reasonable. Market volatility has been encouraged by a good deal of short-term AI market timing as investors seek to “buy the dips and sell the rips.” Tariff policy, which has greatly contributed to the uncertainty and volatility this year, will also be carefully watching well into the new year. For this first trading day of 2026, trading appears to be back to normal with volume coming in at 15.92 billion vs the 15.87 average.
DJ: 48,063.29 -303.77 NAS: 23,241.99
-177.09 S&P: 6,845.50
-50.74 12/31
DJ: 48,382.39 +319.10 NAS: 23,235.63
-6.36 S&P: 6,858.47
+12.97 1/2
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