Market Momentum: A Tug of War Between Stocks and Bonds

U.S. markets showed mixed results as stocks steadied and Treasury yields rose, missing the expected 'Santa Claus rally.' Geopolitical tensions and uncertainties around President-elect Trump's policies influenced market dynamics, while low trading volumes contributed to slight market fluctuations amid year-end strategies.

On Thursday, Wall Street indexes displayed a mixed performance, while U.S. benchmark Treasury yields barely moved after reaching their highest levels in months. This occurred during light trading post-Christmas, as uncertainties around President-elect Donald Trump's policies lifted gold prices, impacting market stability.

Despite initial dips, U.S. stocks leveled off, interrupting a 'Santa Claus rally' sentiment. Analyst Peter Cardillo suggested the year-end rally could persist despite temporary setbacks, indicating a cautious anticipation of 2025's economic conditions influenced by geopolitical tensions and monetary adjustments by the Fed.

Additional data showed slight deviations in new U.S. employment claims and ongoing claims, reflecting challenges for laid-off workers. Various global markets reacted diversely, with Japan's Nikkei advancing and European markets taking a holiday pause.

(With inputs from agencies.)