Wall Street gains at end of turbulent 2018

American flags fly outside of the New York Stock Exchange on Monday Oct. 8 2018. CREDIT Bloomberg

American flags fly outside of the New York Stock Exchange on Monday Oct. 8 2018. CREDIT Bloomberg

The S&P 500 ended up 0.85 percent, the Nasdaq closed 0.77 percent higher and the Dow Jones Industrial Average ended up 1.15 percent for the day on Monday, a nice improvement considering the low volume of the pre-holiday trading day.

December was a particularly awful month: The S&P 500 was down 9% and the Dow was down 8.7% - the worst December since 1931. The partial shutdown and another increase in the federal funds rate in December kept markets from a Santa Claus rally, which was greatly needed to keep indexes positive for the year.

While the economy isn't facing the challenges people in 1931, during the Great Depression, were facing, headwinds are building.

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The Nasdaq is lost 268.11 points, or 3.9 per cent.

The Dow declined 1,391.76 points, or 5.6 per cent. The S&P 500 posted tiny losses in 2011 and 2015, but eked out small gains in both years once dividends were included. Germany's DAX ended the year in a bear market, down 22 percent from a high in January and 18 percent from the start of the year. There was a spurt of renewed optimism on Monday, and the Dow Jones Industrial Average finished the final session with a gain of 1.2 percent at 23,327.46. "I don't think they'll be bad stocks, I just don't think they'll be the high-fliers that they've been this year".

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"For markets to move higher next year, we're going to have to resolve those issues", Kravetz said. The Nasdaq Composite closed at 6,635.28 for a gain of 50.76 points or 0.77%.

The economy is expected to finish 2018 with around a 3 percent annual growth rate, which some economists did not think possible. On Monday, the two-year Treasury yield also reported its largest monthly decrease in 10 years, which could further help the outlook for stocks. The Dow also closed more than 1,000 points higher on December 26 - the first time it ever accomplished that feat.

On Monday, benchmark US crude oil inched up 0.2 percent to settle at $45.41 a barrel in NY.

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Investors drew encouragement from a tweet from President Donald Trump on Sunday, in which the president said he had a "long and very good call" with Chinese President Xi Jinping. If made, it will be very comprehensive, covering all subjects, areas and points of dispute. But the surge faded during afternoon hours as a broad set of concerns remain, including a grim manufacturing report out of China, slowing global economic growth, rising US interest rates and a troubling decline in oil prices.

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