US financial markets experienced mixed performance and relative stability at the close of the week, with US stocks settling at the end of Friday's session after the broader market index reached new record highs in early trading. Trading volumes and liquidity were noticeably low, a typical occurrence in financial markets following the Christmas holiday (December 25), as many investors and financial institutions prefer to remain on the sidelines until the start of the new year.
Details of the closing of US indices
In a detailed analysis of the closing figures, the Dow Jones Industrial Average finished trading unchanged at 48,710 points. Despite this stability in the final session, the index suffered a clear loss of 1.20% over the course of the week, reflecting selling pressure on leading stocks in recent days.
Meanwhile, the S&P 500, the broadest measure of US market performance, settled at 6,929 points. The index had reached a new record high during the session, touching 6,945.77 points, before paring its gains, ending the week with a total loss of 1.40%.
The technology sector saw a slight decline, with the Nasdaq Composite Index falling by nearly 0.10%, losing about 20 points to close at 23,593 points, thus recording a weekly decline of 1.22%.
Trading context and the impact of the holiday season
These movements come within the context of what is known as "year-end trading," where markets are typically characterized by price volatility resulting from reduced liquidity and the absence of major market makers. Historically, the period between Christmas and New Year's tends to be relatively quiet, but it can sometimes witness quick profit-taking by investors seeking to close their positions before the end of the fiscal year. This explains the selling pressure that led to weekly losses despite record highs.
Economic analysts are closely monitoring this period, as it is considered an initial indicator of investor sentiment at the start of the new year, amid anticipation of economic data related to inflation and interest rates that will directly affect the Federal Reserve's decisions in the coming period.
Mixed performance of global markets
Internationally, the picture differed between European and Asian markets. European stock exchanges were completely closed on Friday for "Boxing Day" and are scheduled to resume normal activity early next week, thus insulating the US market from being directly affected by the movements of its European counterparts.
In contrast, Asian markets, particularly in Japan, saw a notable rebound, bucking the US trend. Japan's Nikkei 225 index rose 0.68% to close at 50,750 points, posting a strong weekly gain of 2.51%. The broader Topix index also climbed 0.15% to 3,423 points. This positive performance in Tokyo reflects domestic optimism and perhaps benefited from exchange rate movements, underscoring that global markets do not always move as a single unit, especially given the divergent monetary policies of major central banks.
