What Happens To S&P 500 When Santa Rally Fails? Strategist Says 'Don't Stop Believing In Santa' - SPDR S&P 500 (ARCA:SPY)

Core Viewpoint - The Chief Market Strategist of Carson Research, Ryan Detrick, encourages investors to remain optimistic despite historical warnings about the absence of a "Santa Claus Rally," as the S&P 500 is close to reaching a new all-time high [1][2]. Market Resilience - The holiday trading period is about to begin, and Detrick emphasizes that the market's recent resilience indicates that "Santa" has not abandoned Wall Street [2]. - Detrick noted a swift recovery of the S&P 500 from recent volatility, with the index trading near all-time highs, contrasting with a 2.6% decline just three trading days prior [3]. Seasonal Indicators - Detrick acknowledges the importance of seasonal indicators, particularly the "Santa Claus Rally," which is defined as the last five trading days of the year and the first two of the new year, as a strong predictor of near-term performance [4]. - Historical data shows that negative returns during this seven-day period often precede a challenging first quarter, citing a -0.5% return in the previous year (2024) followed by a 4.6% drop in the first quarter of 2025 [5]. Year-to-Date Performance - Despite the rough start, the market is up nearly 17% year-to-date, with the S&P 500 increasing by 17.21%, the Nasdaq Composite by 21.51%, and the Dow Jones by 14.08% [6][7]. - The SPDR S&P 500 ETF Trust (SPY) and Invesco QQQ Trust ETF (QQQ) both closed higher, with SPY up 0.62% at $684.83 and QQQ up 0.47% at $619.16 [8].