🎯 Weekly Wrap: Jan 5, 2025 📉
From Santa's No-Show to a New Year's Rally: Markets Kick Off 2025 with a Bang (and a Few Bumps)
Hey everyone,
What a week we just wrapped up in the markets! We closed out 2024, put a bow on the Santa Claus Rally period, and dove headfirst into 2025. The markets had a mixed bag of performance, with small caps stealing the show while the big names took a breather. Let’s break it all down.
The Numbers at a Glance
Russell 2000: 📈 Up 1.1% this week (small caps doing their thing!)
S&P 500 & Nasdaq: 📉 Both dipped 0.5% for the week
2024 Wrap-Up: S&P soared 23.3%, and the Nasdaq closed a stellar 28.6% higher
Even though the Santa Claus Rally didn’t deliver its usual cheer (historically +1.3% on average since 1950), let’s not panic. Remember, Santa didn’t show last year either, and the S&P still crushed it with a 23.3% gain in 2024. Maybe Santa’s just working on his own schedule. 😉
Sector Winners & Losers
It wasn’t all doom and gloom. Energy was the clear winner this week, up 3.2%, followed by real estate and health care eking out small gains. On the flip side, materials, consumer discretionary, and consumer staples took the biggest hits, sliding between 1.4% and 2.1%.
Light trading volume (thanks to holiday closures) played its part, but the S&P did slip below its 50-day moving average—a level to watch in the coming weeks.
Day-by-Day Breakdown
Here’s what went down each day:
Monday:
Markets stumbled out of the gate. The S&P dipped below its 50-day moving average (5,942), which triggered some buy-the-dip action, but momentum fizzled by the afternoon. Nvidia ($NVDA) tried to help, but the overall vibe stayed bearish.
Tuesday:
The last trading day of 2024 felt like a microcosm of the year—strong start, but it couldn’t hold. Small caps managed to squeak out a gain, while the Nasdaq, S&P, and Dow ended lower. Rising Treasury yields and mega-cap profit-taking dragged things down.
Thursday:
Welcome to 2025! The new year started with some turbulence. Indices showed early strength, but rising rates and weakness in Apple ($AAPL) and Tesla ($TSLA) turned the tide. Tesla’s Q4 delivery report capped off its first annual decline in deliveries, while Apple took a hit from cautious iPhone demand commentary.
Friday:
Finally, some green! A broad rally pushed the S&P 500 up 1.3% for the day, with all 11 sectors in the index closing higher. Mega caps led the charge, and market breadth was solid, with advancers outpacing decliners 3-to-1 on both the NYSE and Nasdaq.
Economic Data Highlights
A few key reports worth noting:
Jobless Claims: Still low at 211,000, signaling employers are holding onto workers—a good sign for the economy.
ISM Manufacturing Index: Contracting for the 9th straight month, but the pace slowed slightly.
Final Thoughts
2025 has kicked off with a bit of everything—profit-taking, new-year rebalancing, and even some buy-the-dip action. While the Santa Claus Rally fizzled, it doesn’t mean the sky is falling. Instead, I see opportunities brewing, especially in small caps and energy.
What are your thoughts on how 2025 is shaping up? Any sectors or stocks catching your eye? Let me know in the comments—I'd love to hear your take!
Until next week, Stay disciplined, stay profitable, and trade smarter! 🎯-EC
*Disclaimer The examples and information in this article are for educational purposes only and not financial advice
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