The Dow lost 117, the S&P dropped 15 and the Nasdaq slipped 42. US stocks ended the final trading day of 2015 with a whimper rather than a bang Thursday, as the S&P and the Dow both snapped multiyear winning streaks. The Dow lost 179 to 17,425, finishing 2015 down 2.2%, for its first annual loss since 2008. The S&P dropped 17 to 2,044, snapping a three-year winning streak. The index had traded between fractional gains and losses for the year for most of the session, then nosedived in the final hour of trading, netting a 0.7% loss for 2015. The Nasdaq declined 58 to 5,007, the only index out of the three to post a gain for the year. That gain makes it four years in a row the Nasdaq has posted a yearly gain, its longest winning streak since 2007.
The dollar’s appreciation has been a potent force. The greenback may have further to rise. The dollar is up 9.8% against the Federal Reserve’s basket of major currencies this year, on track for its third best performance in 30 years. Its best performance during that time, an 11.7% increase in 2014. The back-to-back run has had consequences. It has hurt US exports, and lowered the value of multinationals’ sales overseas, hitting profits. It has magnified the decline in oil and other raw materials, increasing commodity producer woes. And it has pushed US import costs lower, contributing to low inflation that left the Fed wary of raising rates. The dollar can’t go up forever, but analysts are predicting at least another 2.3% next year.
Global financial markets in 2015 were pulled between two opposing forces: The Federal Reserve’s determination to raise interest rates, as the U.S. job market strengthened; and pressure for lower interest rates in much of the rest of the world, as China’s economic growth slowed and commodity prices sank. The results of the tug of war were a soaring dollar, crumbling junk bonds, stubbornly low Treasury yields and a manic-depressive stock market that is ending the year roughly where it started.
Listen in for much more in A Wall Street Wrap-up.
