Wall Street edged lower on the last trading day this year amid rising fears of a potential market recession in 2024

Wall Street edged lower on the last trading day this year amid rising fears of a potential market recession in 2024.

Wall Street edged lower on the last trading day this year. The main three indexes fell and sent a negative message in terms of inflation and markup. Today’s session was not expected among investors and has raised concern about the market in terms of its momentum and its ability to withstand global political and macroeconomic challenges.

As for investor hopes and estimations for the next year, government spending is expected to remain at 2023 levels until the November election. Speaking about the political front, Biden is losing support from the Americans due to their support for the Iraq War and constant military and fiscal help. Arguably, there is a big conflict in U.S. Congress powerhouses, and thats due to fresh or old Washington forging and internal policies.

All his facts can be concluded positively or negatively on the U.S. economy. Still, on the other hand, investors’ fears of returning inflation haven’t been wiped up yet. Some market experts see that inflation might increase. Especially if the global market takes another downturn.

Moving to the equity market, analysts shared serious concerns. Yet at the same time, they remain optimistic about the market and its performance in 2024. On that subject, Sam Stovall, chief investment strategist at CFRA Research, says, “Expectations are that investors will lighten up early in the new year. On top of that, household debt service payments as a percentage of disposable personal income are also at historic lows. And that could be challenging to recover in 2024. Add to that business loan delinquency rates and consumer loan delinquency rates, which are also near-historic lows.

While on Wall Street, the S&P 500 benchmark declined by 0.43% to 4,772 basis points. The index slipped on Friday, nearing its January 2022 all-time high; closing above would confirm entry into a bull market after the October 2022 bear market. In terms of market expectations, deficit spending is higher than the previous year and, if sustained, could lead to new highs in the S&P 500 (SPX) around 5300.

The tech-heavy Nasdaq composite was down by 0.6% to close at 15.003 points. Overall, Nasdaq outperformed, rising 43% in 2023, driven by the AI boom and the megacap stock surge.

The Dow Jones Industrial Average was down by 0.24% to a total index bps of 37.617 basis points. Dow Jones reached a record high on Thursday. Despite today’s losses, the main indexes are set for monthly and quarterly advances with double-digit gains in 2023.

other economic news, and this time the bond market. In 2023, the US 10-year Treasury yield ended at 3.9%, almost where it started. The rates went up and down, ranging from 3.25% to 5%, influenced by worries about a recession and the surprising resilience of the economy. The unexpected strength caught Wall Street by surprise, especially as the Federal Reserve kept raising rates until July. Towards the end of the year, weakening economic data and a more cautious stance from the Fed led to a bond rally, but there wasn’t a significant annual change in the yield. Predictions for 2024 suggest a potential economic slowdown and the chance of the Fed cutting rates, but they’re uncertain.