S&P 500 falls slightly Friday, but rides 9-week win streak to end 2023 with 24% gain: Live updates

Samantha Subin
Jesse Pound

Stocks fell slightly on Friday, but the S&P 500 closed out 2023 with a surprising gain of 24% as inflation slowed, the economy remained strong and the Federal Reserve signaled an end to its rate-hiking campaign.

The S&P 500 rose for nine straight weeks to end the year, its best win streak since 2004. Big Tech stocks lifted the Nasdaq Composite to its best year since 2020 on AI enthusiasm.

The broad index fell 0.28% to settle at 4,769.83, with a 24.2% gain for the year. The S&P 500 ends 2023 just short of a new all-time high. At one point on Friday, it climbed within 9 points, or less than 0.2%, from its record close of 4,796.56 attained in January 2022.

The Dow Jones Industrial Average lost 20.56 points, or 0.05%, to close at 37,689.54 on Friday. It finished the year with a 13.7% gain and notched a new record during 2023. The Nasdaq Composite edged down 0.56% to 15,011.35 for the session, but rose 43.4% for its best year since 2020.

"Momentum continues to remain favorable heading into year end," said Mona Mahajan, senior investment strategist at Edward Jones. "It's been quite a phenomenal run."

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The S&P 500 is on the cusp of a new record high.

The S&P 500 added 0.3% on the week. The Dow and Nasdaq gained 0.8% and 0.1% for the week, respectively, to clinch their longest weekly winning streaks since 2019.

Stocks bounced back this year after a rough 2022. The story for the better part of the year was the excitement around artificial intelligence fueling big gains for the "Magnificent 7" stocks like Nvidia and Microsoft. The enthusiasm bolstered the indexes even as the average stock struggled amid rising interest rates and fueled the outperformance of the tech-heavy Nasdaq.

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The Nasdaq Composite has surged more than 40% in 2023.

But with the Federal Reserve signaling it is likely done with rate hikes, and could even cut rates multiple times next year, the 10-year Treasury yield dove from above 5% in late October to less than 3.9% on Friday. As rates fell and labor data remained strong, investors ended the year growing more confident in a possible "soft landing" where the U.S. economy avoids a recession.

As a result, the market rally broadened out in the fourth quarter, with the industrial-heavy Dow making a string of record highs in December. The small-cap Russell 2000 rose more than 12% in December and clinched its best month since November 2020. It also notched its best quarter since the fourth quarter of 2020.

This expansion in market breadth will likely continue into the new year, although a period of consolidation isn't out of the question as some of the high-fliers "recalibrate," said Nancy Tengler, CEO & CIO of Laffer Tengler Investments.

Wall Street will also keep a watchful eye as more Fed speakers weigh in on the prospect of rate cuts ahead of January's meeting, Mahajan said, which could lead to some early volatility in the new year.

"The risk with the Fed is that they will either wait too long, or move too quickly," Tengler said. "If they cut too soon, and we do see inflation resurge, that's going to be bad news for everybody."

Fri, Dec 29 2023 4:25 PM EST

Stocks finish lower, but S&P 500 gains 24% for the year.

Stocks finished lower on Friday but capped off the year with gains.

The S&P 500 fell 0.28% to settle at 4,769.83, with a 24.2% gain for the year. It struggled to notch a new all-time high, coming within 9 points, or less than 0.2%, from its record close of 4,796.56 attained in January 2022 during Friday's session.

Elsewhere, the Dow Jones Industrial Average lost 20.56 points, or 0.05%, to close at 37,689.54. It finished the year with a 13.7% gain and notched a new record close. The Nasdaq Composite edged down 0.56% to 15,011.35, but rose 43.4% for its best year since 2020.

— Samantha Subin

Fri, Dec 29 2023 3:51 PM EST

Stocks are 'stretched' entering 2024, Sethi warns

Sarat Sethi, managing partner at DCLA, said on "Power Lunch" that investors should be cautious about chasing the recent stock market rally into the new year.

"I do think valuations are stretched, and I think they key here is that the market is so dependent on the Fed. Because that was the pivot for equities to go up. I think you're not going to get multiple expansion, you have to have earnings growth, and we still have some geopolitical uncertainty out there," Sethi said.

The rally has broadened out in the final months of the year as interest rates retreated, with investors betting on rate cuts from the Fed in 2024. But the Big Tech stocks that shouldered the burden before that are still rising. The CNBC Magnificent 7 Index is still up nearly 13% in the fourth quarter.

"Things are priced to perfection, especially the Mag 7. And they can perform just fine, but I think there's opportunities elsewhere, and I think you have to be careful after a 24% run [for the S&P 500]," Sethi added.

Fri, Dec 29 2023 3:46 PM EST

Gas prices could fall below $3 this winter

Prices at pump are down significantly from September highs.

A gallon of gas averaged $3.12 on Friday, down nearly 20% since prices peaked on Sept. 18, according to data from the motorist group AAA.

Gas prices could fall below $3 this winter before rising to around $4 as summer approaches, according to GasBuddy's 2024 fuel outlook.

Prices at the pump have fallen as crude oil prices have dropped significantly this year. U.S. crude and global benchmark Brent are both down 10% for the year.

— Spencer Kimball

Correction: This story has been updated to correctly reflect how much gas prices have fallen this year.

Fri, Dec 29 2023 3:40 PM EST

BlackRock files updated registration form for proposed bitcoin ETF

BlackRock filed an amended version of the registration form for the iShares Bitcoin Trust on Friday, further evidence that a decision on a bitcoin ETF is coming soon.

The asset management firm has filed multiple amended versions of the S-1 form for the bitcoin ETF since first initiating the process in June.

The latest update lists Jane Street Capital and JPMorgan Securities as authorized participants, which means those firms would help with the share creation and redemption process for the ETF. Those firms were not listed as involved with the ETF in the previous filing.

The more detailed filing suggests that the Securities and Exchange Commission is getting closer to a decision on whether to allow spot bitcoin ETFs. Many industry experts expect the funds to be approved in January.

— Jesse Pound

Fri, Dec 29 2023 3:30 PM EST

Gold posts first annual gain since 2020 with rally expected to continue

Gold prices have surged in 2023 as investors flock to the precious metal as a safe haven amid geopolitical risk and on anticipation that the Federal Reserve will start slashing interest rates.

Gold gained 13% for the year. The precious metal hit an an all-time high $2,135.50 on Dec. 4.

JP Morgan forecasts the rally will continue in 2024 with gold hitting a targeted peak of $2,300 per ounce sometime in the middle of 2024 driven primarily by the Fed slashing interest rates.

The investment bank said the previous metal is vulnerable to a retreat toward the $1,900 range in the coming months, but this would set investors up to position themselves for the midyear really.

— Spencer Kimball

Fri, Dec 29 2023 3:20 PM EST

Bitcoin on pace for a down week to cap an otherwise stellar year, ether heads for best month since January

Bitcoin is on pace to end the week on a down note to cap what has otherwise been a stellar year for the flagship cryptocurrency.

On Friday afternoon it was down 3% on the week at $42,061.00, according to Coin Metrics. That was its second negative week in a row, but the crypto asset is still on track to post a 12% gain for its best month since October and fourth consecutive up month.

Meanwhile, ether is up less than 1% for the week and trading at $2,314.10. If it stays in the green through the end of the day that would make this week its fifth positive one in the last six.

Ether is heading for its best month since January and also its fourth month straight of gains. It's up 13% in December.

— Tanaya Macheel, Chris Hayes

Fri, Dec 29 2023 3:11 PM EST

As the year ends, stocks are approaching new records

Across the board, stocks have had a blockbuster year. Here's how major indexes have performed:

Small-cap indexes have also had a strong run in 2023, signaling a broadening within the market as investors remain enthusiastic about interest rate cuts in 2024. The Russell 2000 has added 15.6% this year, while the S&P Small Cap 600 has advanced 14.3%.

— Pia Singh

Fri, Dec 29 2023 2:58 PM EST

2024 could be a banner year of returns for small-cap stocks, says Tom Lee

Fundstrat Global Advisors' head of research, Tom Lee, predicts a banner year ahead for small-cap stocks.

A huge relief will be due the broader equity market when the Fed begins to cut rates next year, he told CNBC's "Squawk on the Street" on Friday. But in particular, he believes that small-cap stocks could "easily" rally 50 percentage points next year.

Small-cap stocks are currently trading at their 1999 lows, or levels they haven't touched in almost 40 years. For context, Lee added, 1999 was the launch point for 12 years of small-cap gains.

And even as recessionary overhangs loom over the market while the dollar weakens, the analyst believes that small-cap multiples still have room to expand and their earnings still have room to grow. He pointed out that during the "pretty vicious" bear market from 1999 to 2003, small-cap stocks made some of their absolute best returns.

For the broader equity market, Lee believes that the current rally will push the S&P 500 to new heights in the first two months of the year. From late-February to mid-April, however, he predicts a 5-10% drawdown before stocks return to rallying.

— Lisa Kailai Han

Fri, Dec 29 2023 2:46 PM EST

These are 2023's biggest Nasdaq winners

After a debilitating 2022, excitement around artificial intelligence seemed to reignite the technology trade in 2023, pushing the Nasdaq Composite up more than 43% and on pace for its best year since 2020.

The concentrated Nasdaq-100 has experienced an even more fruitful year, with the index up more than 53% and on pace for its best yearly performance in two decades.

Leading this year's gains is none other than Nvidia. The poster chiled of the artificial intelligence arms race has rallied 236% and is one pace for its second best year ever. Meta Platforms is the second top performers, with shares up 194% and the social media giant on track for its best year ever.

Crowdstrike, Advanced Micro Devices have rallied about 141% and 110%, respectively. Palo Alto Networks, DoorDash, MongoDB and Tesla round out the list of companies that have seen shares at least double in 2023, with Broadcom and Zscaler following close behind.

But 2023 hasn't been a favorable year for everyone. As of midday Friday, 17 stocks in the Nasdaq-100 are headed for a losing year, led by Moderna with a nearly 45% loss. Illumina and Walgreens Boots Alliance have shed more than 30% year to date.

— Samantha Subin

Fri, Dec 29 2023 2:21 PM EST

ETF assets expected to close the year at record $11.5 trillion

Exchange-traded funds enjoyed another big year in 2023, setting a new record for total assets amid a big rally in the stock market.

Assets for the industry surpassed $11.5 trillion globally across all asset classes, according to ETFGI figures released Friday. Inflows for the year are expected to hit $938 billion, the second-highest on record.

In December alone, the industry is expected to show growth of more than $176 billion, the 55th consecutive month of net inflows, ETFGI said.

—Jeff Cox

Fri, Dec 29 2023 2:01 PM EST

S&P 500 sits 0.6% off of record close

As of midday trading Friday, the S&P 500 sits about 0.6% off of its all-time closing high of 4796.56 achieved in January 2022.

Throughout the week the broad index has edged closer to that level, rising as high as 4,788.43 during Friday's session. At its highs, the S&P came within 9 points, or less than 0.2%, from its record close.

— Samantha Subin

Fri, Dec 29 2023 1:33 PM EST

Mining stocks were big winners this year but could have a difficult time ahead

Mining stocks have seen some of the biggest gains this year thanks to the 150% run in bitcoin. Marathon Digital is on pace for a 600% gain, Riot Platforms is heading for a 350% gain and Wall Street darlings CleanSpark and Iris Energy are up 350% and 531%, respectively.

But while bitcoin's price has been climbing it's hash rate has too, hitting new all-time highs every week through the year. That's a good thing for the Bitcoin network but it weighs on miners' margins and profitability – and could hurt them in the new year after their mining revenue gets cut in half after the Bitcoin halving.

Of course many on the Street are optimistic about bitcoin's outlook in 2024. Some are suggesting bitcoin will hit a new record, but others are concerned that inflows into bitcoin ETFs after potential SEC approval won't live up to the hype, and that bitcoin could suffer a short-term correction down to $32,000.

— Tanaya Macheel

Fri, Dec 29 2023 1:13 PM EST

Technology leads year-to-date gains, while utilities lags

Of the stock market's 11 sectors, 7 are slated to finish the year in the positive.

To no surprise, the technology sector — up 56.83% — leads 2023's gains. The sector is on pace for its best yearly performance since 2009, when it gained 59.92%.

The emerging trend of artificial intelligence usage has largely propelled the performance this year for technology stocks. The three-highest performing Magnificent 7 stocks — Nvidia, Meta and Tesla — are respectively up 241%, 197% and 105% this year.

On the other hand, utilities stocks have been the laggard, collectively down 10.12% this year. Interest rates lingering at elevated prices have plagued the traditionally rate-sensitive sector.

— Lisa Kailai Han, Christopher Hayes

Fri, Dec 29 2023 12:35 PM EST

Stocks making the biggest moves midday: Fisker, Lyft and more

These are the stocks moving the most in midday trading:

  • Fisker — The electric vehicle stock gained nearly 18% after Fisker reported it grew deliveries by over 300% from the third to fourth quarter.
  • Lyft — Shares slipped 4.6% after a Nomura downgrade to reduce from neutral, saying Lyft's growth could be limited due to its shrinking market share and low profitability compared to peers.
  • Boston Scientific — Shares of the medical device company rose almost 3% after Boston Scientific announced the initiation of a clinical trial for one of its devices as a first-line treatment for persistent atrial fibrillation.

Read the full list of stocks moving here.

— Lisa Kailai Han

Fri, Dec 29 2023 11:35 AM EST

Japan's Nikkei caps off best year since 2013

All the major averages are on pace to wrap up a winning year, but U.S. equities aren't the only indices capping off a strong 2023.

Japan's Nikkei closed the year up 28.24% Friday, notching its best year since 2013, when the index gained 56.72%., while Taiwan ended the year up 26.8% for its best year since 2009. Elsewhere, India's BSE SENSEX ended the year up 18.74% for the eight straight positive year.

China-based indices didn't fair as well, with both the Shenzhen Composte and Shanghai Composite closing out back-to-back losing years.

In Europe, Greece's ATHEX Composite has jumped nearly 39% and is pace for a third consecutive winning year and its best yearly stretch since 2019. The German DAX is also headed for its best year since 2019.

Elsewhere, Turkey's ISE 100 is headed for a fifth straight positive year, while Italy's FTSE MIB is headed for its best year since 1998. Both France's CAC and the Europe STOXX 600 are headed for their second positive year in three.

— Samantha Subin, Gina Francolla

Fri, Dec 29 2023 11:04 AM EST

Popular growth fund on track for best year since 2000

The market rebound in 2023 is on track to result in a historic milestone for at least one popular growth fund.

The iShares Russell 1000 Growth ETF (IWF) enters Friday up 41.99% for the year. That would be the best performance for the fund on record back to its inception in May of 2000.

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The IWF ETF is on track for its best year since its inception in 2000.

The banner year for the IWF is indicative of the strong performance of Big Tech in 2023. The fund's top holdings include Apple, Microsoft, Amazon and Nvidia.

The fund has $82 billion in assets under management.

— Jesse Pound, Christopher Hayes

Fri, Dec 29 2023 10:32 AM EST

Oil prices to end year nearly 10% lower, first annual decline since 2020

Oil prices are on pace to close out the year about 10% lower, as bearish sentiment has overtaken the market on supply and demand worries.

The West Texas Intermediate contract for February gained 35 cents, or .52%, to trade at $72.14 a barrel on Friday. The Brent contract for March rose 45 cents, or .58%, to trade at $77.60 a barrel.

U.S. crude and the global benchmark are down nearly 10% for the year despite ongoing geopolitical risk in the Middle East due to the war in Gaza. Oil prices jumped earlier this week on fears that militant attacks on Red Sea shipping would disrupt global shipping and impact supply.

But traders are more worried that the market is oversupplied and production cuts promised by OPEC and its allies will not be sufficient to bring the market into balance.

The U.S., Brazil and Guyana are pumping crude at a record a pace as a weakening economy in China is expected to impact demand. Oil production outside OPEC alone is expected to cover demand growth growth in 2024, according to the International Energy Agency.

— Spencer Kimball

Fri, Dec 29 2023 10:05 AM EST

Chicago PMI reading falls, misses expectations

Business activity in the the Chicago area unexpectedly pulled back in December, according to a gauge released Friday.

The Institute for Supply Management's Chicago Business Barometer purchase managers index posted a reading of 46.9 for the month, down sharply from the 55.8 in November and below the Dow Jones estimate of 50.

As the index measures the percentage of companies reporting expanded activity, anything below 50 represents contraction.

— Jeff Cox

Fri, Dec 29 2023 9:31 AM EST

Stocks open little changed to kick off final trading day of 2023

Stocks opened little changed on Friday to start the final trading day of 2023.

The Dow Jones Industrial Average added 8 points, while the S&P 500 and Nasdaq Composite hovered near the flatline.

— Samantha Subin

Fri, Dec 29 2023 9:04 AM EST

ARK Innovation ETF heads for third best year ever

Cathie Wood's Ark Innovation ETF is up 73% in 2023 and on pace for its third best year on record since its 2014 inception.

Last year, the fund lost 67% as technology stocks slumped. The fund notched its best year ever in 2020, when it gained 149%.

Coinbase, Archer Aviation, Meta Platforms, DraftKings, Tesla, Shopify, Palantir, Roku and UiPath are among the biggest gainers in the fund. Shares of these companies have more than doubled since the start of the year.

Some underperfomers in the index down more than 10% this year include PagerDuty and Beam Therapeutics.

— Samantha Subin, Gina Francolla

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