Santa Claus Rally Pushes S&P 500 Near Records as Wall Street Eyes 2026
The holiday week was good to investors. Real good.
The S&P 500 climbed about 2.3% for the shortened trading week. Nasdaq did even better at 2.5%. Dow Jones came in around 1.6%. All of them hovering near the record highs we hit on Christmas Eve.
Yahoo Finance confirmed the numbers and yeah. The Santa Claus rally is definitely happening.
What the Analysts Are Saying
So I’ve been digging through the 2026 predictions from the major banks and the range is honestly kind of wild. Motley Fool broke down what 14 different Wall Street analysts are predicting.
On the low end you got Bank of America’s Savita Subramanian calling for 7,100. On the high end Oppenheimer’s John Stoltzfus is saying 8,100. Thats a thousand point spread which tells you how much uncertainty is baked into next year.
Deutsche Bank is at 8,000. Morgan Stanley at 7,800. JPMorgan at 7,500. Yahoo Finance has the full list if you want to see all 13 strategists.
Christmas Eve Records
Christmas Eve was the big day for records. Both the Dow and S&P 500 hit all time closing highs before the holiday break. The S&P touched an intraday high around 6,932.
The Nasdaq is up over 20% for 2025 now. Thats… a lot. AI and tech stocks have been driving most of it.
This Week’s Calendar
Heads up for anyone trading this week. Tuesday is going to be busy. ADP employment numbers come out and we get the FOMC minutes from their last meeting. Markets close early on New Year’s Eve and are shut Wednesday for the holiday.
CNBC has some analysis on which stocks might be getting ahead of themselves. Worth a look if youre rebalancing for the new year.
My Take On All This
Look I grew up in a family where nobody had a stock portfolio. My dad worked the line at Ford. We didnt talk about P/E ratios at dinner. So I try to keep perspective when I write about these things.
Regular people are still struggling with housing costs and grocery bills even while the stock market breaks records. Those two things can both be true at the same time.
But if you do have a 401k or any retirement savings the last couple years have been genuinely good. The retirement system has problems but market performance aint one of them lately.
What to Watch
The Fed calendar is always worth keeping an eye on. Rate decisions are going to be a big story in 2026. Whether we get cuts or not will move markets.
Bank of America’s conservative call is based on valuation concerns. They think stocks might be getting expensive. The bulls disagree obviously.
Happy investing. May your 2026 portfolio be greener than 2025.
