Traders work on the floor at the New York Stock Exchange on Dec. 10, 2024.
The Dow Jones Industrial Average and the S&P 500 declined Monday as the market started a holiday-shortened trading week on a soft note.
The blue-chip Dow fell 270 points, while the S&P 500 dipped 0.2%. The tech-heavy Nasdaq Composite last traded near the flatline.
Trading is expected to be relatively muted during the week. The New York Stock Exchange closes early Tuesday for Christmas Eve at 1 p.m. ET, and the market is shut on Christmas Day.
Weak economic data seemed to sour the sentiment. The Conference Board's consumer confidence index for December fell to 104.7, its lowest level since September and below a Dow Jones estimate of 113.0. Meanwhile, orders for durable goods — generally big-ticket items such as aircraft, appliances and computers — fell 1.1% in November, the largest month-over-month drop since June.
The market is coming off a roller-coaster ride that saw the blue-chip Dow suffer a 10-day losing streak, its longest since 1974. The Dow tumbled 1,100 points Wednesday after the Federal Reserve signaled fewer rate cuts for 2025 than previously projected. A cooler-than-expected inflation reading at the end of the week helped stocks recoup some of the losses.
Month to date, the 30-stock Dow is down 4.6% in December, while the S&P 500 is off 1.7%. The tech-heavy Nasdaq Composite bucked the downtrend, rising 1.8% this month.
Investors have been reassured that federal agencies will stay open into the new year after President Joe Biden signed a funding bill Saturday that averted a government shutdown. The bill funds federal agencies at current levels for the next three months.
Money Report
Santa rally?
Investors were hopeful that a so-called Santa Claus rally may help the market end 2024 on a high note, especially following a tumultuous week. Dating back to 1969, the S&P 500, on average, added 1.3% in the last five trading days of the year and the first two in January, according to the Stock Trader's Almanac.
The second half of December is also typically the second-strongest period of the year for U.S. equities, and the S&P 500 has been up 83% of the time in December of presidential election years, according to Bank of America.
"With the market's primary uptrends still intact, we are not giving up on the potential for a Santa Claus to come to Broad & Wall this year," Craig Johnson, chief market technician at Piper Sandler, said in a note.
MicroStrategy shares fall on first day of bitcoin proxy's Nasdaq-100 inclusion
MicroStrategy slid on the stock's first day of inclusion in the Nasdaq-100 index.
Shares of the bitcoin proxy were last lower by more than 5%. Bitcoin itself fell more than 1% to the $93,000 level after rising to a new all-time high above $106,000 last week.
The company sold 1.3 million shares to buy another 5,262 bitcoin for about $106,662 a coin, it disclosed in a Dec. 23 filing. The new purchase brings its total bitcoin holdings to 444,262.
— Tanaya Macheel
Small caps struggle
Small cap stocks took a relatively large leg down as the new trading week kicked off.
The small cap-focused Russell 2000 slid more than 0.7% in morning trading. The broad S&P 500, by comparison, ticked lower by just around 0.2%.
Monday's performance extends the December theme of small caps taking an outsized hit. The Russell 2000 has tumbled more than 8% this month, while the S&P 500 has fallen less than 2% over the same period.
— Alex Harring
Nordstrom shares fall after family agrees to take department store private
Department stores have been in decline for years, but talk of a potential bid has buoyed Nordstrom stock in recent months. That long-anticipated deal was made official Monday with the Nordstrom family and Mexican retailer El Puerto de Liverpool offering shareholders $24.25 per share, or roughly $6.25 billion.
Nordstrom shares fell 1.3% on the news, but the stock is up nearly 33% year to date. That gain sets Nordstrom stock apart from other department stores. Macy's shares are down 19% year to date, while Kohl's stock has sunk more than 50%.
It's worth noting that in 2018, the Nordstrom board rejected the founding family's offer to take the company private, saying the offer was too low. The bid at that time, $50 a share, is more than double the current offer.
—Christina Cheddar Berk
Orders for durable goods fell in November
Orders for durable goods — generally big-ticket items such as aircraft, appliances and computers — fell 1.1% in November, the largest month over month drop since June, according to preliminary data from the U.S. Department of Commerce.
This followed a 0.8% increase in October. Transportation equipment, which has fallen three of the last four months, led the decline in November.
— Yun Li
Xerox to acquire Lexmark in $1.5 billion deal, shares rise
Shares of Xerox Holdings rose around 9% in premarket trading on Monday following the announcement that it's buying printer maker Lexmark in a deal valued at $1.5 billion.
To help fund the deal, Xerox said it will cut its dividend in half, trimming its annual payout to 50 cents from $1. The reduced rate will begin in the first quarter. The deal is expected to close in second half of 2025.
"Our acquisition of Lexmark will bring together two industry-leading companies with shared values, complementary strengths, and a deep commitment to advancing the print industry to create one stronger organization," Xerox CEO Steve Bandrowczak said in a statement. "By combining our capabilities, we will be better positioned to drive long-term profitable growth and serve our clients, furthering our Reinvention."
Shares have spent the year in the red, with the stock sliding more than 54% year to date. In December, shares have also fallen more than 8%.
— Sean Conlon
Honda gains following merger talks announcement
U.S.-listed shares of Honda jumped more than 15% in the premarket on the heels of the company and fellow Japanese automaker Nissan announcing they've officially begun merger talks.
According to Honda CEO Toshihiro Mibe, the merged company has the potential to bring in 30 trillion yen ($191.4 billion) in revenue and more than 3 trillion yen in operating profit. The companies plan to wrap up discussions in June 2025.
Honda shares have had a rough year. Year to date, the stock has fallen more than 22%, drastically underperforming the broader market.
— Sean Conlon, Jenni Reid
See the stocks moving before the bell
These are some of the stocks making moves in Monday's premarket:
- Novo Nordisk — The pharmaceutical stock jumped 4.9%, rebounding from Friday's selloff on the back of weaker-than-expected drug trial data.
- Xerox — The document services provider added nearly 11% after saying it would acquire printer maker Lexmark.
- Despegar.com — Shares surged 32% after Prosus entered into a definitive agreement to buy the Argentina-based online travel platform.
— Alex Harring
European shares higher
Markets in Europe saw gains on Monday, with shares erasing earlier losses to trade higher by 9:24 a.m. London time.
The pan-European Stoxx 600 was up 0.2%, with sectors in mixed territory. Investors in the region were making trades ahead of planned market closures for the Christmas holiday later this week.
Read the latest on European markets here.
— Chloe Taylor
December is historically the second-best month for stocks
December is historically the second-best month in a U.S. presidential election year for the Dow Jones Industrial Average and S&P 500, according to the Stock Trader's Almanac. On average, the two indexes gain 1.3% and 0.8% on the month, respectively, during such years. For the Nasdaq Composite, presidential election year Decembers are usually the fifth-best of the year, with the tech-heavy index rising an average 0.9%.
The bulk of gains in December usually come in the back half of the month, when a Santa Claus rally, and low trading volumes, could give this year's monster run one final push toward the finish line.
— Sarah Min
