US stock exchanges expected to see little change before Christmas - Fed interest rate cut in the new year? Dow Jones and Nasdaq 100 in focus.

US stock exchanges expected to see little change before Christmas - Fed interest rate cut in the new year? Dow Jones and Nasdaq 100 in focus.

According to a report by www.boerse.de, US stock markets are expected to see little change on the last trading day before Christmas. Inflation data on Friday was broadly in line with expectations, reinforcing market views that the Fed will cut interest rates in the first or second quarter of the new year. At the same time, incoming orders for durable goods in the world's largest economy rose sharply in November after a weak October. The Dow Jones Industrial was calculated 0.2 percent lower at 37,325 points around three quarters of an hour before the stock market opened, while the Nasdaq 100 should start 0.1 percent higher at 16,780 points on Friday, according to IG. The yield on trend-setting ten-year government securities remained at a five-month low.

US personal income and spending rose largely as expected in November and price inflation continued to weaken. Despite a weak outlook from sporting goods manufacturer Nike for the second half of the 2023/24 financial year, market sentiment is unlikely to suffer at all at the moment. The hope of the mostly positive last trading days of the year means that hardly anyone will part with their shares. A takeover plan by the pharmaceutical company Bristol-Meyers Squibb (BMS) for Karuna Therapeutics is also likely to attract attention.

Given this information, I expect market sentiment to remain positive as inflation data was in line with expectations and yields remain at five-month lows. The weakness in inflation and the stable incomes of US citizens could lead to an optimization of the Fed's interest rate policy, which in turn could have a positive effect on the market. Nike's weak outlook could have a temporary negative impact on its share price, but I don't expect overall market sentiment to be significantly dampened. The planned acquisition of Karuna Therapeutics could lead to increased volatility in the share prices of the companies involved. Allusion to a "serious review" of Nippon Steel's takeover of US Steel by US President Joe Biden's top economic adviser could also lead to uncertainty about the steel group's share prices.

Overall, the last trading days of the year are likely to be characterized by generally positive market sentiment, accompanied by potential short-term fluctuations and influences from corporate news and takeover plans.