Stock market today: Indexes bounce back as investors aim to end 5-day losing streak

A trader works on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., January 24, 2020.

Lucas Jackson/Reuters

• US stocks edged higher on Friday as investors aim to end a five-day losing streak.
• A surging 10-year US Treasury rate has put pressure on stocks as investors worry about a rebound in inflation.
• Investors will focus on ISM manufacturing data and Fed speeches for economic insights.

US stocks jumped on Friday as investors aimed to end a five-day losing streak and post their first daily gain of 2025.

Putting pressure on stocks over the past week has been a surging 10-year US Treasury rate, which is near a one-year high of about 4.56%.

The higher yield has led to higher mortgage rates and is putting added emphasis on coming inflation reports, as investors worry about a potential rebound in pricing pressure ahead of Donald Trump's second term in the White House.

The S&P 500 is trading just above a make-or-break support level, according to Fairlead Strategies' Katie Stockton.

Stockton highlighted the 5,870 level in the S&P 500, arguing that a breakdown below that level would give way to a 5% sell-off to the 200-day moving average at about 5,555.

The S&P 500 traded at around the 5,938 level in Friday's pre-market session.

Friday marks the last day of the Santa Claus Rally trading window.

Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Friday:

• S&P 500: 5,901.35, up 0.53%
• Dow Jones Industrial Average: 42,535.28, up 0.34% (+142.66 points)
• Nasdaq composite: 19,461.47, up 0.94%

Michael Reinking, senior market strategist at the New York Stock Exchange, said a negative return during the 7-day trading window could be a bad sign for 2025.

"There would need to be a significant rally to end that time period higher. When this time period does not produce positive returns, it can serve as a warning of potentially difficult times ahead," Reinking said in a Friday note.

Investors will be laser-focused on the 10 a.m. release of December's ISM manufacturing data. Economists expect the data to come in at 48.0, compared to November's reading of 48.4%.

Fundstrat's Tom Lee highlighted this macro data as "the most important" economic data of the week in a recent note.

"If the ISM moves above 50 in 2025, this is a sign of business expansion (purchasing managers) and thus, suggests that EPS growth diffusion should improve in 2025," Lee said.

There will be some Fedspeak today, with Richmond Fed President Tom Barkin speaking at 11 a.m. and Fed Governor Adriana Kugler speaking at 4 p.m.

Here's what else is going on:

• There is a federal tax that is stopping older homewoners from selling their properties.
• The US surgeon general said that alcohol causes cancer and needs a warning label like cigarettes.
• President Joe Biden blocked Japan's $14 billion takeover bid of US Steel on national security grounds.
• Here is a complete rundown of Wall Street's 2025 S&P 500 targets.

In commodities, bonds, and crypto:

• West Texas Intermediate crude oil jumped 0.38% to $73.41 a barrel. Brent crude, the international benchmark, was higher by 0.25% to $76.12 a barrel.
• Gold was lower by 0.28% to $2,661.50 an ounce.
• The 10-year Treasury yield was flat at 4.567%.
• Bitcoin increased 0.26% to $96,991.
  

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