Reuters
Heavyweight Nvidia fell 1.1% in premarket trading, while Google parent Alphabet lost 0.5%.
As of 05:03 a.m., Dow E-minis were down 146 points or 0.33%, S&P 500 E-minis were down 26.75 points or 0.44%, and Nasdaq 100 E-minis were down 118.75. points or 0.54%.
Markets in London and parts of Asia were closed on Thursday.
The S&P 500 and Nasdaq closed Tuesday’s truncated session with a third consecutive session of gains driven by mega-cap and growth stocks.
Gains in Apple, Tesla, Alphabet, Amazon, Nvidia, Microsoft and Meta Platforms accounted for more than half of the S&P 500’s 28.4% total return this year, according to S&P Dow Jones Indices senior analyst Howard Silverblatt.
Without the Magnificent Seven stocks, the benchmark’s total return would have been 13.2% in 2024, Silverblatt added.
U.S. stocks have taken a hit this month following gains led by November’s election, while facing the Federal Reserve’s projection of fewer interest rate cuts in 2025.
Investors expect a typically strong finish to the final days of the year – called the “Santa Claus rally” – a pattern attributed to low liquidity, tax loss harvesting and year-end bond investing.
The S&P 500 has gained an average of 1.3% in the last five trading days of December and the first two days of January since 1969, according to Stock Trader’s Almanac. A December without a Santa rally was followed by a weaker-than-average year, LPL Financial data dating back to 1950 showed.
Data from the Labor Department on weekly jobless claims will be released before the market opens on Thursday, although claims have entered a period of volatility, which could make it difficult to get a clear view of the labor market.
Separately, major banks and business groups sued the Federal Reserve on Tuesday, alleging that the U.S. central bank’s annual “stress tests” of Wall Street firms violate the law.
(Reporting by Medha Singh in Bengaluru; Editing by Anil D’Silva)
