It's Not Too Late... Anticipation for a 'Santa Rally' Still Alive [New York Stock Market Weekly Outlook]

Ahead of Trump's Inauguration on January 20

Growing Expectations for Banks and Cryptocurrencies

Last week, all three major indices of the New York Stock Exchange ended in a downward trend. As profit-taking sales poured in, especially in tech stocks that had seen significant gains this year, the declines in the three indices widened. Investors who had hoped for a Santa Rally might have been somewhat disappointed.

Investors are hopeful that the 'Santa Rally' might reappear this week (December 30 - January 2). Despite major investors selling off stocks last week, the S&P 500 index rose by 1.7% and the tech-heavy Nasdaq increased by 1.8% on a weekly basis.

Wall Street is particularly optimistic about the economic policies of President-elect Donald Trump. Trump's policies, characterized by tax cuts, are expected to help improve the performance of American companies. Sectors like banks, energy, and cryptocurrencies are expected to benefit directly from deregulation. The Federal Reserve announced regulatory easing related to stress tests on the 23rd (local time). Given Trump's favorable stance on cryptocurrencies, the crypto industry has also stepped up to support Trump's inauguration on January 20. The cryptocurrency trading platform Kraken has already donated $1 million. Trump is expected to announce at least 25 executive orders at the inauguration on the 20th.

The market is also focused on Tesla's fourth-quarter vehicle delivery numbers coming out next week. Tesla, considered a 'Trump beneficiary stock,' has seen an increase in vehicle registrations in China since the third quarter. Notably, news broke on the 23rd that the Model Y was sold out in China.

Next week, the October S&P Case-Shiller Home Price Index (December 31), U.S. weekly jobless claims (January 2), and the December ISM Manufacturing PMI will be released. The market will be closed on January 1.

New York Correspondent: Park Shin-young