Published: 24 December 2025,01:51
Daily Market Analysis New
Key Takeaways:
*Wall Street remains supported into year-end, underpinned by easing inflation pressures, resilient U.S. growth, and rising confidence that the Fed is approaching the end of its tightening cycle.
*Santa Claus Rally dynamics are reinforcing risk appetite, with thinner liquidity, year-end portfolio rebalancing, and short-covering helping sustain gains in the S&P 500 and Nasdaq.
Market Summary:
U.S. equities continued to edge higher into year-end, with Wall Street supported by resilient economic data, easing inflation pressures, and growing confidence that the Federal Reserve is nearing the end of its tightening cycle. The S&P 500 and Nasdaq extended their gains as investors remained focused on large-cap technology and growth stocks, reinforcing the seasonal tailwinds typically associated with the Santa Claus Rally period.
Fundamentally, sentiment has been underpinned by a soft-landing narrative. Recent U.S. data points to moderating inflation without a sharp slowdown in growth, allowing markets to look ahead to potential rate cuts later in 2025. Treasury yields have stabilised following recent volatility, easing pressure on equity valuations and providing support for duration-sensitive sectors.
Seasonality has added to the constructive backdrop. Thinner liquidity, year-end portfolio rebalancing, and short-covering activity have encouraged dip-buying and helped suppress downside volatility across major U.S. indices. Continued portfolio positioning into year-end has favoured outperforming sectors, further supporting index-level strength.
Still, caution persists beneath the surface. Elevated valuations, lingering geopolitical risks, and uncertainty over the timing of Fed easing are capping upside momentum. Firm gold prices and intermittent demand for defensive assets suggest investors remain partially hedged. The sustainability of the Santa Claus Rally will hinge on upcoming U.S. inflation data and Fed messaging, which will shape expectations for monetary easing in the months ahead.
Technical Analysis
The Dow Jones Industrial Average continues to trade within a well-defined bullish structure on the chart, maintaining its sequence of higher highs and higher lows despite recent consolidation near record levels. Price remains supported above the rising trendline that has guided the advance since mid-year, reinforcing the broader uptrend and suggesting that recent pullbacks have been corrective rather than trend-changing. From a price-action perspective, the market is consolidating just below resistance rather than rejecting sharply, which typically reflects absorption of supply rather than aggressive distribution.
Momentum indicators remain constructive but moderated. The RSI is holding in the upper-50s, signaling stable bullish momentum without entering overbought territory, consistent with a consolidation phase within an ongoing uptrend. Meanwhile, the MACD remains in positive territory, though the histogram has flattened, reflecting slowing upside momentum rather than a confirmed bearish reversal.
Resistance Levels: 49,100.00, 51,000.00
Support Levels: 46,420.00, 44,325.00
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