Stock Market Opens 2025 with Positive Momentum

NEW YORK (AP) — U.S. stock indexes have kicked off the year 2025 with notable gains, signaling a potential end to a four-day losing streak that had clouded the conclusion of a remarkable 2024. On Thursday morning, the S&P 500 increased by 0.6% as trading commenced, following its longest losing streak since early September. Meanwhile, the Dow Jones Industrial Average climbed 332 points, representing a rise of 0.8%, and the Nasdaq composite also saw a boost, rising by 0.7%. These gains were supported by encouraging news about the U.S. economy, particularly as fewer individuals filed for unemployment benefits last week than were forecasted by economists. Additionally, Treasury yields declined in the bond market.

Markets around the globe exhibited mixed results on this inaugural trading day of 2025. Chinese stock indexes experienced steep declines, with losses exceeding 2%. In Europe, the CAC 40 in France fell by 0.5%, settling at 7,346.33, while Germany’s DAX edged up 0.2% to reach 19,947.91. The British FTSE 100 remained nearly unchanged at 8,174.85. Futures for both the S&P 500 and the Dow Jones Industrial Average suggested a 0.4% increase.

Investor sentiment remained cautious regarding the potential actions of incoming U.S. President Donald Trump, particularly concerning the possibility of increased tariffs on imports from China and other Asian nations. The Shanghai Composite index dropped 2.7% to close at 3,262.56, with Hong Kong’s Hang Seng index also falling by 2.2% to 19,623.32.

A recent survey gauging factory activity in China revealed a slowdown in growth for December, as the Caixin China Purchasing Managers Index fell to 50.5 from 51.5 the previous month, indicating weaker new orders, employment, and business sentiment. Despite Chinese leader Xi Jinping's optimistic remarks during a New Year's address about the economy's recovery, market players were left wanting more decisive measures to bolster growth and lift share prices.

In the Asia-Pacific region, the S&P/ASX 200 in Australia gained 0.5% to 8,201.20, while South Korea’s Kospi remained stable at 2,398.94.

U.S. markets were closed on Wednesday in celebration of New Year's Day, mirroring the closure of nearly all global markets on that date. On Thursday, investors are anticipating updated data on U.S. construction spending for November, with U.S. manufacturing figures for December set to be released on Friday.

In recent trading, prior to the New Year, U.S. stock indexes mostly finished lower, marking a bleak conclusion to a year that had featured remarkable gains on Wall Street. The impressive performance in 2024 was fueled by a strengthening economy, robust consumer spending, and a healthy jobs market. Notably, soaring stock prices of companies in the artificial intelligence sector, like Nvidia and Super Micro Computer, helped propel the market to record highs.

Even though the Federal Reserve had executed three rate cuts during 2024, indications suggest that the central bank will take a more careful stance entering into 2025, as persistent inflation creates concerns heading into Trump's presidential transition. Trump's potential tariff increases on imported goods have added to worries that inflation may resurge as companies might pass these costs onto consumers.

In energy markets, benchmark U.S. crude oil saw a slight increase of 26 cents, reaching $71.98 a barrel, while international standard Brent crude gained 28 cents, landing at $74.85 a barrel.

The value of the U.S. dollar slipped to 156.79 Japanese yen, down from 157.24 yen, while the euro rose slightly to $1.0368 from $1.0359.

Stocks, Market, Economy