Markets usually have a positive skew in the weeks around the Christmas holiday and so far this year is no different as indexes gapped up sharply at the open for a second straight day. The S&P 500 added 0.88% and the NASDAQ 0.65%.
In economic news, the National Association of Realtors said existing home sales declined 10.5% in November, far greater than expected. The final read on third-quarter GDP came in at an annualized rate of 2%. Economists polled expected annual growth of 1.9%, down slightly from the second estimate of 2.1% but above the advance estimate of 1.5%.
Tomorrow will be the last recap of the week as market’s close early on Thursday and Friday is the holiday.
Interesting to note: The Dow is at risk of closing negative in a pre election year for the first time since 1939.
During pre-election years, like 2015, each administration tries hard to impress voters, either via stimuli or copious amounts of lipstick to make even the ugliest pig (aka, the economy) look pretty. Historically, pre-election years sport the best performance numbers of the four-year presidential election year cycle. On average (based on data going back to 1933), the Dow Jones Industrial Average gains 10.40% during pre-election years. In fact, the last time the Dow Jones Industrial Average recorded a year-end loss in a pre-election year was in 1939. Unless the Dow climbs back above 17,824, this will be the first pre-election year loss since 1939.Continue reading