Nasdaq Dips 0.4% on Final Stretch before 2026
Stocks are near all-time highs after a decent Christmas week that showed indications of a Santa Clause rally.
Quick overview
- The Nasdaq Composite fell 0.4% on Monday but is set to finish the year with a 22% gain.
- The Dow and S&P 500 also posted strong annual gains of 14% and 17%, respectively.
- The market experienced a Santa Clause rally, driven by strong performances from stocks like Nvidia.
- Despite earlier predictions of a market crash, 2025 ended with elevated numbers and strong quarterly earnings.
After hitting close to an all-time high over the Christmas week, the Nasdaq Composite fell 0.4% on Monday but will still end the year with impressive gains.
The last three days of trading for 2025 have begun, and the stock indices are ticking downward slightly. The Dow is mostly flat, but the S&P 500 dipped 0.2% while the Nasdaq fell twice as far. Still, the leading three U.S. stock indices should finish the year with strong gains.
At this point in 2025, the Nasdaq has managed to gain 22%, which is impressive considering how far it dropped during the spring when steep tariffs hit the market. The Dow added 14% this year, performing more steadily but not as impressively as the other two indices. The S&P 500 added 17% this year as well, marking an incredible performance in spite of strong hindering factors.
Did the Market Have a Santa Clause Rally?
It looked like the stock market might dip during the Christmas week, but instead, many stocks were trading close to their all-time highs last week. The period known as the Santa Clause rally really was profitable for the market this year. The upswing was propelled by strong performances from Nvidia (NVDA), which has grown 5.6% over the last five days of trading.
Not all tech stocks did so well this last week, like Advanced Micro Devices (AMD), which held mostly steady throughout Christmas week. Microsoft (MSFT) gave a similar performance, making only mild gains as much of the market pushed toward all-time highs.
The market certainly rallied, though, and the wildly volatile 2025 trading year looks close off with elevated numbers. This has been a year of unexpected twists for the market, with tariffs causing confusion and producing desperate investment shifts. The usually low-performing September month proved to be a strong month this year, demonstrating that 2025 is very unpredictable.
Despite months of analysts predicting that the market would crash or would end the year extremely low, none of that happened, and 2025 continues the trend of strong market performance from the last few years. There were also concerns late in the year that the AI market would collapse. And even though AI stocks dipped for many weeks, they have made back most of those losses since, and fears over a collapsing market have mostly disappeared on the backs of strong quarterly earnings reports.
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