Investing.com– The U.S. main indices opened higher Tuesday, the last trading day of the year that marked record overall gains.
At 9:45 ET (14:45 GMT) the benchmark averages were up with the S&P 500 gaining over 1%, the Dow Jones Industrial Average up about 0.3%, and the NASDAQ Composite gaining 0.04%.
Despite these losses, 2024 has been a remarkable year for U.S. equities, with all major indexes nearing record highs.
The Nasdaq is on track for a roughly 30% annual gain, the S&P 500 is set to rise over 24%, and the DJIA has climbed more than 13%, marking the best performance for these averages since 2021.
Mega tech stocks “expensive” – BoA
Investors capitalized on substantial gains accumulated throughout the year, particularly in the technology sector.
Rising treasury yields exerted additional pressure on equities. Higher yields make bonds more attractive to investors seeking lower-risk returns, potentially drawing capital away from stocks.
Bank of America called the megacap stocks “expensive and crowded” in a recent note, while it preferred mid-cap equities for better opportunities in 2025.
Tesla gains on gigafactory news
Tesla (NASDAQ:TSLA) stock was slightly up at 0.3% after the market opened on Tuesday. Chinese state news agency Xinhua reported that the company’s energy storage gigafactory in Shanghai has entered trial production, just seven months after construction began, with full-scale production expected to commence early next year.
Boeing (NYSE:BA) shares gained 0.8% after the previous session’s hefty losses, following a devastating air accident in South Korea claimed the lives of 179 people on Sunday when a passenger plane crash-landed at Muan International Airport.
ISM manufacturing activity data due
The economic data calendar is largely empty Tuesday, ahead of Wednesday’s holiday, and later in the week, investors will scrutinize the Institute of Supply Management’s manufacturing activity survey for December and a weekly report on jobless claims, ahead of a key employment report due in the following week.
Crude gains on Chinese data
Crude prices rose Tuesday, boosted by signs of growth in Chinese manufacturing activity, but are on track to end lower for a second consecutive year due to demand concerns in top consuming countries.
By 9:45 ET, the US crude futures (WTI) climbed 0.7% to $71.51 a barrel, while the Brent contract rose 0.5% to $74.38 a barrel.
China’s manufacturing sector expanded in December but at a slower-than-expected pace, marking its third straight month of expansion as a raft of fresh stimulus measures provided support.
The outlook for oil demand largely hinges on the hope that China, the world’s largest oil importer, can revive its economy, especially as there are concerns about a potential oversupply due to expected increases in production from non-OPEC countries.
The Brent benchmark is still on course for a loss of around 3% in 2024, while the WTI contract is largely unchanged over the course of the year.
(Ayushman Ojha contributed to this article.)