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Week in Review: 23-27 December 2024 - Year End

Financial Markets

This week, trading volumes were lower than average, which is usual in the holiday season. The main stock market indices were little changed, with the S&P500 and the NASDAQ 100 gaining 0.7% and 0.9%, respectively. The small cap index (Russel 2000) gained just 0.4% for the week, after moving up and down during the week, forming a nice dogi pattern.

Gold was flat and silver lost 0.45%. Gold remains on the lower range of the current trading channel, while silver is looking weaker and might to fall to 28$/oz in the near future. If the price of gold doesn't remain in the current trading channel, it might go lateral or correct in the short/medium term. The loss of momentum in gold indicates that the fear of inflation has subdued somewhat.

WTI rised to 70$ and should continue in the 67-71$ range in the next week.

Bitcoin fell to 94k$ and the 93k$ level seems to be a short term support.

The relative strength of the US dollar (DXY) was unchanged this week (~108). The EUR/USD is around 1.04$, the GBP/USD is at 1.26$, and the USD/JPY is at 157.8 JPY.

US M2 money supply at the date of 28th October 2024 was up by 0.42%.

The national financial conditions index (NFCI) for the week of 16th December 2024 loosened by just 0.2%, which shows a slowing down in the loosening of financial condition, if compared with previous weeks. Note that this indicator is delayed by a week.

US bond yields rose again this week, and now sit at 4.330% for the 2-year and 4.629% for the 10-year

The VIX fell to ~16, indicating less fear in the markets and less search for put options from the part of investors/speculators.


Comment Section

We reached the last Week in Review of 2024. Hopefully, it was a profitable and productive year for you, and this newsletter helped you to keep track of the markets.

There is nothing to extrapolate from this week's trading. We need to wait for January 2025, which will bring up the volume and may help to establish a new trend - slightly corrective, perhaps, as valuations are a bit too rich in the US stock market!!!
 
Economic challenges in Europe and China, the new Trump government, geopolitics, and a never coming US recession will keep the coming year very interesting and exciting.
 
Enjoy the holidays, take care, and happy new year!!!
 

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