The bullish chorus on stocks is getting louder heading into Thanksgiving as the market looks to regain its winning ways around the holiday.
The Dow Jones Industrial Average touched a record on Tuesday and sentiment was high riding into the traditionally strong two-day period surrounding Thanksgiving. The Dow has only had 16 losses in the past 66 years for the Wednesday before Thanksgiving and the Friday after combined, according to the Stock Trader's Almanac.
All financial markets are closed Thursday for Thanksgiving and close early Friday.
But the Dow has suffered losses for the past two straight years in the trading days surrounding Thanksgiving. For the Wednesday before Thanksgiving and Black Friday combined, the Dow was down about 32 points and 180 points in 2017 and 2018, respectively.
Stocks rose slightly on Monday amid increasing expectations that China and the U.S. will reach a so-called phase one trade deal. The S&P 500 is up 25% in 2019, on track for its biggest one-year gain since 2013. Historically, the S&P 500 has carried over its momentum into the following year after an annual gain of at least 25%.
"This stock market melt up is impressive for sure, putting the S&P 500 at 19x 2019 earnings," Peter Boockvar, chief investment officer at Bleakley Advisory Group, said in a note Tuesday. "I'm optimistic too that there will be a deal of some sort."
China's Ministry of Commerce said Tuesday morning that the leaders of China and the U.S. spoke over the phone. It's still unclear whether the two sides could reach a deal before Dec. 15, when new U.S. tariffs on Chinese goods are set to kick in. The U.S. and China have imposed tariffs on billions of dollars' worth of one another's goods since the start of 2018.
The Dow gained nearly 350 points in the days before and after Thanksgiving in 2008, the best two-day performance since 1952, according to the Stock Trader's Almanac. The worst two-day performance goes to 2011, when the Dow lost 261 points during those days around Thanksgiving.
— CNBC's John Schoen contributed to this report.