The Santa Claus Rally’s Here. Why Advisors Are Channeling Their Inner Scrooge

Market Sentiment - The Santa Claus rally, historically linked to a rise in stock prices during the last five trading days of December and the first two in January, has seen the S&P 500 gain an average of 1.2% since 1969 [2] - Advisor sentiment regarding the US economy has declined for five consecutive months, with over 40% of advisors expecting a less healthy economy, the highest level of pessimism recorded this year [2][3] - The current advisor economic sentiment reading is 101, indicating a neutral outlook, but it has decreased by 5% in the last month and is down 16% compared to the same time last year [3] Economic Outlook - Advisors with a positive economic outlook peaked at 63% in April but have since dropped to their lowest levels in twelve months [5] - The percentage of advisors expecting a less healthy economy by the end of next year has doubled from 21% in June to 42% [5] - Concerns are primarily attributed to high valuations and market concentration in Big Tech, leading to fears of a significant market correction in the new year [3]