Today marks the final trading day in global stock markets before Christmas, and traders hope the traditional Santa Rally will boost their fortunes.
The Santa Rally is a stock market trend where shares in developed markets typically rise during the Christmas season. Current indicators suggest that this rally has begun, albeit later than usual.
Markets across the Asia-Pacific region are experiencing gains, with China’s CSI 300 index up by 1.27%, Hong Kong’s Hang Seng rising 1%, Australia’s S&P/ASX 200 inching up 0.25%, and South Korea’s KOSPI index increasing by 0.13%.
These movements follow Wall Street’s performance last night, where the S&P 500 climbed by 0.7%.
In the UK, this momentum sets the stage for gains in today’s shortened Christmas Eve session. FTSE futures are up 0.6%, which could lift the London market away from last week’s one-month low.
Market sentiment has been unsettled in recent weeks due to concerns that central banks might not reduce interest rates as quickly as expected in 2025. Investors now anticipate only two interest rate cuts next year in both the US and the UK.
Global economic growth is also projected to slow down next year, and the potential return of Donald Trump to the White House heightens the risk of new tariffs impacting global trade. Trump’s election victory sparked a market rally in November, suggesting that perhaps the Santa Rally has arrived early this year.
