Santa Claus Rally: Will Wall Street End the Year on a High Note?

U.S. stock futures showed declines post-Christmas due to light trading. Notable drops included Nvidia and Alphabet. Despite recent gains driven by big tech, stocks face challenges with fewer projected rate cuts in 2025. Investors remain hopeful for a seasonal 'Santa Claus rally' to bolster year-end performance.

In the wake of the Christmas holiday, U.S. stock index futures experienced declines on Thursday amid reduced trading volumes. This trend comes as investors hope for a 'Santa Claus rally' to lend support to their portfolios before year's end.

Heavyweight stocks such as Nvidia and Alphabet saw premarket declines of 1.1% and 0.5%, respectively. As of early Thursday morning, major indexes were down: Dow E-minis fell by 146 points, S&P 500 E-minis declined by 26.75 points, and Nasdaq 100 E-minis dropped by 118.75 points.

Despite previous gains driven by tech giants like Apple and Tesla, U.S. stocks face hurdles from the Federal Reserve's potential restraint on interest rate cuts projected for 2025. Meanwhile, legal challenges against the Fed's annual stress tests add further uncertainties to the financial landscape.

(With inputs from agencies.)