Market Summary: What happened yesterday and what awaits us today, December 31st

Market Summary: What happened yesterday and what awaits us today, December 31st
A quiet end to the year in financial markets, with a decline on Wall Street and fluctuations in gold.

Major U.S. stock indexes ended Tuesday’s trading session lower for the third consecutive day, while gold and silver prices recovered part of their losses following a sharp one-day sell-off. A cautious tone dominated global markets as the year drew to a close.

The losses came at the start of a shortened trading week due to the New Year holiday. The Dow Jones Industrial Average, Nasdaq, and S&P 500 closed lower by around 0.2%, 0.2%, and 0.1% respectively, reflecting weak risk appetite and a lack of strong market catalysts.

U.S. markets showed little reaction to the release of the Federal Reserve’s December meeting minutes, which revealed divisions within the Federal Open Market Committee ahead of its decision to cut interest rates for the third consecutive time.

Meanwhile, data from the Case-Shiller Home Price Index showed annual house price growth of 1.3% in October, exceeding expectations but slowing compared to the previous reading.

Pressure continued on major technology stocks amid investor concerns over elevated capital expenditure levels. Shares of Palantir, Tesla, and Nvidia declined by 1.8%, 1.2%, and 0.4%, respectively, while Oracle shares gained 0.9%.

Intel shares rose 1.7%, while Boeing closed 0.6% higher after securing a major $8.58 billion defense contract. In the technology sector, Meta Platforms shares climbed 1.1% following reports of its acquisition of Singapore-based artificial intelligence firm Manos in a deal valued at over $2 billion.

In precious metals markets, gold futures rose 0.4% to settle near $4,360 per ounce after falling sharply in the previous session following an increase in margin requirements by the Chicago Mercantile Exchange. Silver futures jumped more than 8% to around $76.25 per ounce after retreating from record highs earlier in the week.

In bond markets, the yield on the 10-year U.S. Treasury note rose to 4.13% from 4.11% at Monday’s close. Bitcoin traded near the $87,800 level, supported by selective buying following its recent decline. The U.S. dollar index rose 0.2% to 98.24 points.

U.S. oil prices edged lower, with West Texas Intermediate crude falling 0.2% to trade below $58 per barrel.

Asian markets were mixed during today’s session as caution persisted and liquidity declined ahead of the New Year holiday. Chinese equities fell amid concerns over the economic growth outlook, while Japan’s Nikkei index experienced volatile trading influenced by rising global bond yields and yen fluctuations. Other Asian markets recorded modest gains, supported by technology and export-oriented stocks.

European markets opened cautiously with a downward bias, pressured by Wall Street’s weak close and ongoing concerns about the economic slowdown in the eurozone. Industrial and technology stocks faced relative pressure, while gains in energy and basic materials helped limit overall losses amid thin year-end trading.

Market expectations for today

Looking ahead, market movements are expected to remain confined to narrow ranges with subdued trading volumes, as investors continue to focus on longer-term U.S. monetary policy expectations through 2026. Precious metals may remain volatile, while the U.S. dollar is likely to trade steadily amid low liquidity.