Closing Comment

DJIA: 36,488.63, up 90.42
S&P 500: 4,793.06, up 6.71
Nasdaq: 15,766.21, down 15.51
Dow, S&P 500 notch records; yields rebound

U.S. stocks finished mostly higher on Wednesday in thin holiday trading. The Dow added 90 points to a fresh record, rising for a sixth consecutive session. The S&P 500 eked out a gain of 0.1% to notch its 70th all-time closing high of 2021. The broad benchmark is on track for its best quarter of the year and strongest three-year rally since 1999. The Nasdaq Composite dipped 0.1%. Positive seasonality trends associated with the final week of the year have buoyed sentiment as investors continue to assess the economic impact of the Omicron COVID-19 variant. Despite daily U.S. coronavirus cases hitting a record high, the latest strain appears milder than its predecessors, with a reduced risk of hospitalization.

Eight of 11 S&P 500 sectors closed in positive territory, with the more traditionally defensive groups, including Health Care, outperforming. Biogen surged 9.5% on reports that South Korea’s Samsung was engaging in talks to purchase the biotech company for over $40 billion. In other corporate news, shares of Tesla edged lower despite CEO Elon Musk exercising the last round of his stock options expiring next year. Elsewhere, Victoria’s Secret advanced 12.2% after announcing a $250 million accelerated stock buyback program.

Treasuries weakened, with the yield on the 10-year note backing up seven basis points (0.07%) to 1.55%, its highest level since before the Omicron variant was discovered in November. In commodities, WTI crude climbed 0.6% to $76.47/barrel after government data showed domestic crude stockpiles declined to the lowest level in three months. Also providing support to oil prices, a gauge of the U.S. dollar slipped 0.3%.

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