Updated: 5:01 p.m. ET, Wednesday, December 24, 2025
Wall Street wrapped up a holiday-shortened Christmas Eve session with fresh records, as the Dow Jones Industrial Average and the S&P 500 finished at all-time closing highs and the Nasdaq added to its year-end advance. Thin trading volume and an early close shaped the day’s tone, but investors still found reasons to buy—helped by upbeat labor-market data, a rebound in AI-linked shares, and renewed debate over how far the Federal Reserve will cut rates in 2026.
Stock market today: Dow, S&P 500, Nasdaq close higher on Dec. 24
In Wednesday’s shortened trading session:
- Dow Jones Industrial Average rose 288.75 points (+0.6%) to 48,731.16
- S&P 500 gained 22.26 points (+0.32%) to 6,932.05
- Nasdaq Composite added 51.46 points (+0.22%) to 23,613.31
The gains capped a fifth straight session of advances for the major indexes, reinforcing the late-December “risk-on” mood that often appears as the year winds down—especially when investors feel the Fed is closer to easing than tightening. Reuters
Why stocks rose: AI rebound, resilient jobs data, and rate-cut expectations
1) AI-linked stocks found their footing again
After last week’s pullback—driven by renewed worries about stretched valuations and whether heavy AI spending will ultimately translate into profits—AI-related names bounced, helping lift broader sentiment.
That AI “re-rating” debate is becoming one of the market’s defining themes heading into 2026: bulls see multi-year earnings upside, while skeptics worry capital expenditures are rising faster than proven returns. Reuters+1
2) Jobless claims surprised to the downside
New filings for U.S. unemployment benefits fell to 214,000 (week ended Dec. 20), down 10,000 from the prior week. The Labor Department’s release also showed insured unemployment at 1.923 million and an insured unemployment rate of 1.3% (week ended Dec. 13).
For markets, the takeaway was familiar: the labor market still looks slower than earlier in the cycle, but not broken—supporting the “soft landing” narrative that has helped keep equities bid up even after multiple years of strong gains. AP News+1
3) Traders still see Fed cuts in 2026—even if January looks unlikely
Investors continued to price in roughly 50 basis points of rate cuts in 2026, even as expectations for a January move remained low, according to commentary tied to Fed-funds futures and the CME FedWatch framework referenced in market coverage.
That rate path matters because 2025’s rally—now a third straight year of double-digit gains for the S&P 500—has been tightly linked to a combination of AI optimism, easing financial conditions, and an economy that kept growing.
Holiday trading conditions: early close, light volume, and what that signals
Wednesday’s session was notable not just for record closes, but for how quiet it was.
- U.S. stock markets closed early at 1:00 p.m. ET for Christmas Eve, with certain late sessions closing later in the afternoon.
- Bond markets observed an early close recommendation (2:00 p.m. ET) per SIFMA’s holiday guidance.
- Trading was extremely light: Reuters reported 7.61 billion shares traded across U.S. exchanges versus a 16.21 billion 20-day average, while AP reported roughly 1.8 billion shares on the NYSE—about a third of an average day.
Why it matters: thin liquidity can amplify moves—up or down. Big institutional players are often underweight activity during holiday weeks, so price action can reflect positioning and headlines more than deep conviction.
Biggest movers and headlines: Micron, Nike, Dynavax, Intel—and an Nvidia deal report
Even in a shortened session, single-stock news drove outsized moves:
Micron hits a closing record
Micron Technology shares rose 3.8% to a closing record of $286.68, extending a rally after the company issued a strong forecast last week.
Nike jumps after a high-profile insider buy
Nike jumped 4.6% after Apple CEO Tim Cook, a Nike board member, bought about $3 million in shares, according to reporting cited in the session recap.
Dynavax surges on a takeover
Dynavax Technologies soared (+38.2%) after Sanofi said it would acquire the vaccine maker in a deal valued around $2.2 billion—one of the day’s clearest catalysts in healthcare.
Intel dips amid Nvidia manufacturing chatter
Intel fell after a report that Nvidia halted testing around Intel’s 18A production process—another reminder that semiconductor leadership is increasingly being judged through the lens of AI supply chains and manufacturing execution.
Nvidia and Groq: a $20 billion deal report
After the close, a separate Reuters item said CNBC reported that Nvidia agreed to buy AI chip startup Groq for $20 billion in cash—the kind of headline that can quickly reshape sentiment around the competitive landscape for AI accelerators, inference chips, and hyperscaler spending priorities.
The “Santa rally” is officially underway—here’s what it means this year
Wednesday also marked the start of the closely watched “Santa Claus rally” window—typically defined as the last five trading days of the year plus the first two trading days of January. Reporting tied to the Stock Trader’s Almanac framework noted this year’s period begins on Dec. 24 and runs through January 5. Reuters
Seasonal patterns are never guarantees, but they matter because they often coincide with:
- reduced liquidity,
- year-end portfolio rebalancing,
- tax-related flows,
- and investors positioning for new-year narratives.
Market forecast and outlook: what strategists are watching for 2026
With the S&P 500 up more than 17% in 2025 and nearing the end of its third consecutive year of strong returns, many forecasts published today focused less on whether the market is “strong” and more on whether it can keep delivering above-trend gains. Reuters+1
The bullish case: earnings growth broadens beyond Big Tech
Strategists point to expectations for stronger, broader corporate profit growth. Reuters cited projections for S&P 500 earnings growth of over 15% in 2026, following a solid 2025. A key part of that thesis is that growth expands beyond the “Magnificent Seven,” narrowing the gap between megacap tech and the rest of the index. Reuters
The base-case forecast: decent gains, but harder to repeat another blockbuster year
One prominent example: CFRA’s Sam Stovall told Reuters he sees a 2026 year-end target of 7,400 for the S&P 500—about 7% above current levels—while other strategists project double-digit upside.
Investopedia’s roundup of Wall Street expectations similarly framed 2026 as likely positive but potentially more volatile, citing a mid-December average year-end target around 7,269 (about 5% upside from a recent record close) and highlighting “growing” risks—especially in tech and AI concentration. Investopedia
The key swing factors: Fed policy, valuations, and AI ROI
Across the day’s major analyses, the biggest swing factors were consistent:
- A dovish-enough Fed to support risk assets without reigniting inflation concerns
- Lofty valuations, which can limit upside if earnings don’t keep surprising higher
- AI capital spending returns, especially among hyperscalers and chip supply chains, where investor confidence can shift quickly
- Policy wildcards, including trade dynamics and the political backdrop heading into a U.S. midterm election year
What to watch next: market schedule and key dates after Christmas
When does the stock market reopen?
U.S. markets are closed Thursday, Dec. 25 for Christmas. They reopen Friday, Dec. 26 for a full day, though multiple outlets expect volumes to remain light into year-end as many investors have already reduced activity.
For traders tracking hours closely, official calendars show Christmas Eve early closes and standard sessions resuming afterward.
Why Dec. 26 matters this year
This year’s holiday week also carried an unusual footnote: after President Donald Trump ordered federal executive departments closed on Dec. 24 and Dec. 26, major U.S. exchanges said they would remain open as scheduled, sticking to previously planned calendars (including the early close on Dec. 24).
The late-December data calendar is relatively quiet
Several market previews described the immediate calendar as light, shifting attention back toward rates, positioning, and any late-breaking corporate headlines.
Bottom line for investors
As of 5:01 p.m. ET on December 24, the U.S. stock market has entered the heart of year-end seasonality with momentum: record closes, improving risk appetite, and a policy backdrop that traders still interpret as easing-biased for 2026.
But the same forces powering the rally—AI optimism, rate-cut expectations, and premium valuations—also raise the stakes. In thin holiday markets, it can take only one surprise (data, Fed messaging, or a major corporate headline) to swing sentiment sharply in either direction.
