Trading is expected to be light ahead of the New Year's Day holiday, when markets will be closed. With just one trading day left before the year ends, most big investors have closed out their positions for the year and trading volume has been very thin. Even after their mini post-Christmas pullback, the indexes are on pace for strong gains for the year.
S&P 500 futures ticked downward 0.22% this morning, an indicator that some traders decided overnight to lock in their gains from yesterday's close, when the index reached a new all-time high of 6,901. The peak was entirely predictable, given that U.S. Federal Reserve chairman Jerome Powell delivered a new dose of liquidity, as expected, via Wednesday's 0.25% interest rate cut.Nasdaq 100 futures were down 0.51% this morning, premarket, as traders picked winners and losers in the tech sector.
Opendoor Technologies ( NASDAQ:OPEN ) stock rose more than 13% on Friday, closing at $7.97 per share. The gain came ahead of expected interest rate cuts this week and marked the company's first meaningful increase in a month. It ended a decline that began after shares reached $10.87 per share in mid-September. That earlier peak resulted from meme stock activity, with retail traders pushing the price higher on momentum rather than company results.
Fortune's Shawn Tully points out that the S&P 500's price-to-earnings ratio just hit 30, which often signals impending doom. "A PE of 30 means big cap stocks are really, really expensive by historical standards. It also signals that from these heights, the chance for big returns going forward over any extended period are low, and the risks of a sharp 'reversion to the mean' downdraft is far more likely," he wrote on Tuesday.
Bond yields tumbled as the weaker-than-expected jobs report raised expectations for rate cuts from the Federal Reserve. That sent the average rate on the 30-year fixed mortgage to the lowest level since October 2024. The steep drop could help shake up the housing market, which has seen a dearth of activity amid high home prices and borrowing costs. After a disappointing spring and summer, the housing market could start to heat up as fall approaches with the latest plunge in mortgage rates.
