Investors pin hopes on the ‘January barometer,’ with stocks set to skip ‘Santa Claus rally’ for a third straight year

Core Insights - The S&P 500 index is on track to decline for the third consecutive year during the traditional "Santa Claus rally" period, which has never occurred before [1][3] - Analysts suggest that this does not necessarily indicate the end of the bull market, as historical data shows mixed results regarding the implications of a weak Santa Claus rally [2][3] Market Performance - The Santa Claus rally period includes the last five trading sessions of the previous year and the first two of the new year, starting on Christmas Eve; during this period, the S&P 500 has fallen by 0.9% [3] - Since 2013, the Santa Claus rally has produced positive returns only 66.7% of the time, compared to a historical win rate of 76% since 1950 [3] Seasonal Trends - Recent years have shown inconsistent post-Christmas seasonal strength, with poor returns over the past 12 years not necessarily foreshadowing a bear market in the following year [4] - The performance of the S&P 500 during the first five trading days of January has historically correlated with full-year gains, averaging 14.2% after positive initial sessions, with an accuracy rate of 83.3% since 1950 [6] Future Indicators - Investors will also be monitoring the "January barometer," which suggests that early-year market strength or weakness can influence the rest of the year [7]