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Will a Santa Rally bring festive cheer to investor portfolios this year?


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The Santa Rally is an investment mantra trend that suggests that stocks typically rise during the Christmas and new year period. It is often attributed to thinner trading volumes around the Christmas holidays that may amplify market moves, while City workers may be investing their bonuses.

The article from MoneyWeek discusses the potential for a "Santa Rally" in the stock market towards the end of 2023. Historically, the period between mid-December and early January often sees a positive surge in stock prices, attributed to various factors like holiday optimism, tax considerations, and portfolio window dressing by fund managers. However, this year's outlook is tempered by several economic uncertainties including persistent inflation, high interest rates, and geopolitical tensions. Despite these challenges, there are signs of optimism with some sectors like technology showing resilience, and expectations of a possible dovish pivot by central banks. The article suggests that while a Santa Rally could provide a year-end boost, investors should remain cautious due to the volatile economic environment, with potential for both festive cheer and unexpected market movements.

Read the Full MoneyWeek Article at [ https://moneyweek.com/investments/will-a-santa-rally-bring-festive-cheer-to-investor-portfolios-this-year ]

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