S&P 500 Today: SPX Rallies on Tech Recovery as Positive Seasonality Approaches

The S&P 500 (SPX) is trading higher on the first day of the shortened holiday week as tech stocks continue to recover.

The “Santa Rally,” which spans the last five trading days of the year and the first two trading days of the new year, is set to begin on Wednesday, December 24. For the benchmark index, the seven-day event has posted a positive return 79% of the time with an average gain of 1.3% since 1950, according to Investopedia.

“Barring any major shocks, it will be hard to fight the overwhelmingly positive seasonal period we are entering and the cleaner positioning set-up,” wrote Goldman Sachs’ trading desk team in a note to clients.

Wall Street is quite optimistic heading into 2026 and expects the S&P 500 to return 11%, driven by lower rates, tax cuts, and double-digit earnings growth. However, several experts caution that the optimism could lead to disappointment. Roundhill Financial CEO Dave Mazza notes that the bullish catalysts could already be priced in, while BNP Paribas U.S. Head of Equity and Derivative Strategy Greg Boutle points out that widespread positive sentiment could make the index more susceptible to external shocks.

Meanwhile, Fed Governor Stephen Miran has warned that the economy faces the risk of a recession if the central bank hesitates on rate cuts in 2026. He pointed to a softening labor market as a key factor, with the unemployment rate reaching a 4-year high of 4.6% in November. “If we don’t adjust policy down, then I think that we do run risks,” Miran said on Monday in an interview with Bloomberg TV.

Miran has pressed for an outsized 50 bps reduction at the last few Federal Open Market Committee (FOMC) meetings, although he said that he is unsure if he will support a 25 or 50 bps cut at the January FOMC. The widely favored outcome is for the Fed to hold rates steady, with CME’s FedWatch tool assigning 80.1% odds to that scenario.

The S&P 500 is up by 0.59% at the time of writing.

Which Stocks are Moving the S&P 500?

Let’s take a look at TipRanks’ S&P 500 Heatmap, which illustrates the stocks that have contributed to the index’s price action.

Nvidia (NVDA) is moving higher after the semiconductor leader told Chinese customers that it plans to begin shipping its H200 chips to them before the Lunar New Year in February 2026. The plan is subject to approval from the Chinese government. Earlier this month, President Trump green-lighted the shipment of the chips on the condition that the U.S. government receives a 25% fee.

Magnificent 7 peer Alphabet (GOOGL) is also in the green after it announced the acquisition of data center and energy company Intersect for $4.75 billion in cash, while Tesla (TSLA) is catching a bid after Delaware’s Supreme Court restored CEO Elon Musk’s 2018 pay package. That propelled Musk’s net worth to over $700 billion.

Elsewhere, financial and energy stocks are largely trading higher, while the consumer defensive sector is lagging behind.

SPY Stock Moves Higher with the S&P 500 

The SPDR S&P 500 ETF (SPY) is an exchange-traded fund designed to track the movement of the S&P 500. As a result, SPY moves in tandem with the SPX.

Wall Street expects further upside for SPY. During the past three months, analysts have issued an average SPY price target of $796.78, implying upside of 16.33% from current prices. The 503 holdings in SPY carry 420 buy ratings, 75 hold ratings, and 8 sell ratings.

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