Investors could see the latest stimulus of Wall Street shares at the closing trade session on Monday, but expect no gains to offset losses in the worst December of the last 30s.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York, USA, December 28, 2018. REUTERS / Jeenah Moon
"I think there is a chance that the market could be gathered by the end of the year," said Jake Dollarhide, Chief Executive Officer of Longbow Asset Management, Tulsa, Oklahoma.
The potential for positive news about China's trade dispute and anticipating the upcoming statements by President of Federal Reserve Jerome Powell could raise the market, Dollarhide said. However, no matter how strong any potential relieves, market discomfort is expected to remain.
"When you start passing through December and this is the worst December of Great Depression, it leaves a very strong picture of how bad it was," Dollarhide said. "It can not be avoided, no matter how we gather tomorrow."
Last week he went with the most unfortunate Christmas hat on Wall Street, pushing the S & P 500 into the Bear Market. Overall, the global MSCI index, S & P 500, Dow and Nasdaq move to the worst year since the financial crisis in 2008.
Though spending data was strong, housing data is not, and the market is visible – due to political uncertainty and the closure of the US government.
"It's a rather unpleasant day on Monday … so I think the expectations for the fireworks are not too high," said Rick Meckler, partner of Cherry Lane Investments in New Vernon, New Jersey. "I think you now see a good balance of customers coming to the market and providing a more solid base and the potential for a little uplift."
US President Donald Trump said progress was made in trade dispute with China, which could increase inventories, Meckler said. In addition, strong consumer information on Christmas consumption could support the market.
But after the violent changes this month, it is expected that the last trading day will be relatively dull. There are few companies announcing announcements of the last day of the year, and the volume of trading is expected to be lightweight.
Disappointing economic data on Friday boosted caution, including the slowdown in industrial production and retail sales in Japan, a fall in inflation in Germany, and US data for November show that purchase contracts for former homes hit unexpectedly.
Breaking the bad news, the Chicago Consumer Management Index came before the consensus.
Large indexes moved to positive territory on Friday, and Dow and S & P ended modestly, while Nasdaq recorded a slight growth.
"I think closing on Friday should be seen as very positive for bulls," said Oliver Pursche, board member of Bruderman Asset Management. But despite the reversal of significant losses at the session, Pursche said investors should be cautious in January. "Investors should expect the continuation of overeating moves up and down."