Both the S&P 500 (SPX) and the Nasdaq 100 (NDX) are trading lower on the first day of December, which has historically been a strong month for the market. That comes ahead of the “Santa Rally,” a seven-day period spanning the last five trading days of December and the first two trading days of January which has historically been positive 79% of the time with an average return of 1.3%, according to Investopedia.
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However, Wall Street has warned that seasonality has been off the mark in 2025, raising the risk of a no-show from Santa this year.
Will Santa Show Up in 2025?
“None [of the months this year] have behaved the way they have seasonally,” said RBC Capital Markets Head of Derivatives Strategy Amy Wu Silverman in an interview with Yahoo Finance. Silverman added that she is unsure if the market will experience a Santa Rally this year, although she expects “another volatility pothole or rally in volatility.”
Furthermore, Schwab Asset Management CEO and CIO Omar Aguilar noted that the momentum trade is beginning to ease. “The opportunities for a catalyst that will propel the market up don’t seem to be that strong this time,” he said.
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