SPX: S&P 500 Futures Rise Ahead of Festive Week. Broad Index Boasts 25% Annual Gains

Broad-based Wall Street benchmark is on track to log annual back-to-back gains of more than 20%. Can it do a three-peat?

• Futures tied to the S&P 500 index were pointing slightly higher early Monday with traders feeling jolly at the start of the Holiday-shortened week. The broad-based index fell more than 2% last week after the Fed on Wednesday delivered its bombshell message that interest rates won’t get as low as traders anticipated. But then Friday brought some reasons to stay optimistic when the Fed’s preferred inflation measure rose less than expected.
• The personal consumption expenditures index (PCE) increased 2.4% for November, sliding below expectations of 2.5%. Naturally, bullish investors piled on the index and helped it to recoup some of its losses earlier in the week. Some analysts renewed their hopes that the Fed might reconsider its stance on next year’s interest rate cuts. On a monthly basis, the PCE index rose 0.1%, lower than the 0.2% expected.
• Looking ahead into the week, not much is on deck to stir the scene. Stocks will close up for the full day on Wednesday in light of Christmas. So unless something extraordinary happens (like we suddenly discover the mystery drones are actually aliens from another planet), we’re likely to see the S&P 500 log off for the year with a 25% gain. If so, this would be the second straight year with more than a 20% gain (after a 24% jump in 2023). Can we expect to see a three-peat under Donald Trump?