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U.S. stock futures rose in early trading Thursday as investors looked to start the new year by breaking a four-day losing streak driven once again by mega-cap technology stocks and steady Treasury yields.
Updated at 7:07 am EST
Mortgage increase
U.S. mortgage rates returned to the 7% mark late last year, data from the Mortgage Bankers Association indicated, as bond markets continue to price in some rate cuts from the Federal Reserve in the coming months.
The MBA said the benchmark 30-year fixed rate for conforming mortgages rose 8 basis points to 6.97% during the period ending Dec. 27, with a decline as a result of purchases, refinancings and general activity.
<blockquote class="twitter-tweet”>
30-year mortgage rate US MBA <a target="_blank" href="https://twitter.com/search?q=%24USD&src=ctag&ref_src=twsrc%5Etfw”>$USD
Actual: 6.97%
Previous: 6.75%
– PiQ (@PiQSuite) <a target="_blank" href="https://twitter.com/PiQSuite/status/1874788155817365860?ref_src=twsrc%5Etfw”>January 2, 2025
stock market today
stocks closed a banner year on a down note Tuesday, with the S&P 500 falling 25 points to trim its fourth-quarter gain to about 2.1%. Still, the benchmark index is up more than 23% for the year and marked the biggest string of consecutive gains for domestic stocks since 1998.
The market's focus will now shift quickly to the start of the fourth-quarter earnings season later this month, as well as next week's December jobs data that will fill in the gaps in the Federal Reserve's now cautious outlook on interest rates.
A notable part of that caution, of course, is tied to the new administration of President-elect Donald Trump, who will take office on January 20.
“Our four keys to a strong stock market in 2025 include economic growth (without recession), an accommodative Federal Reserve, strong U.S. corporate earnings, and Trump administration tax and regulatory policy that helps more than it hurts,” said Jeffrey Buchbinder, chief equity strategist at LPL Financial.
“We expect shares to rise modestly next year, although we recognize reasonable upside and downside scenarios,” he added.
Meanwhile, investors are likely to monitor any moves in the Treasury market, which saw benchmark 10-year bond yields decline to 4.533% heading into the year after topping 4.6%. at the end of December.
Related: Gangbuster S&P 500 returns depend on one crucial thing in 2025
Meanwhile, benchmark 2-year bonds were last trading at 4.215% at the start of the New York trading session, while the dollar index was pegged just shy of a two-year high against its global pairs at 108,462.
On Wall Street, stock futures suggest a strong start to the year, despite overnight weakness in Europe and Asia, with futures contracts tied to the S&P 500 indicating an opening gain of 43 points.
Futures linked to the Dow Jones Industrial Average, which posted a gain of just 0.5% in the fourth quarter, are estimated to be up 244 points, while the Nasdaq is expected to open 190 points higher after its advance of the 28.6% in 2024.
stocks in focus include Tesla (TSLA) which will release its fourth-quarter delivery numbers ahead of the start of operations and following the explosion of a Cybertruck outside a Trump hotel in Las Vegas that killed the driver and injured several bystanders.
More economic analysis:
- US stocks Dominate as Bull Market Bets Highlight 'American Exceptionalism'
- Veteran analyst who predicted S&P 500 rally reveals 2025 target
- Trump plans will test Fed's 2025 rate cut bets
In Europe, the regional benchmark Stoxx 600 index was down 0.2% in Frankfurt at the start of the year, while Britain's FTSE 100 rose 0.03% in London thanks in part to solid gains in crude oil stocks and raw materials.
Overnight in Asia, Japan's Nikkei 225 was closed for New Year's celebrations in Tokyo, while MSCI's regional ex-Japan benchmark index fell 0.44% in close trading.
Related: Veteran Fund Manager Issues Dire S&P 500 Warning for 2025
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