{"id":798098,"date":"2025-01-06T12:33:03","date_gmt":"2025-01-06T17:33:03","guid":{"rendered":"https:\/\/www.marketnewsdesk.com\/index.php\/schwab-trading-activity-index-december-score-edges-higher-for-third-consecutive-month\/"},"modified":"2025-01-06T12:33:03","modified_gmt":"2025-01-06T17:33:03","slug":"schwab-trading-activity-index-december-score-edges-higher-for-third-consecutive-month","status":"publish","type":"post","link":"https:\/\/www.marketnewsdesk.com\/index.php\/schwab-trading-activity-index-december-score-edges-higher-for-third-consecutive-month\/","title":{"rendered":"Schwab Trading Activity Index\u2122: December Score Edges Higher for Third Consecutive Month"},"content":{"rendered":"

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Schwab Trading Activity Index\u2122: December Score Edges Higher for Third Consecutive Month<\/b><\/p>\n

More Schwab clients net bought equities than net sold, adding exposure in the Health Care and Energy sectors while net selling Information Technology and Communication Services<\/i><\/p>\n

WESTLAKE, Texas–(BUSINESS WIRE<\/a>)–
\nThe Schwab Trading Activity Index\u2122 (STAX) increased to 51.16 in December, up from its score of 49.22 in November. The only index of its kind, the STAX is a proprietary, behavior-based index that analyzes retail investor stock positions and trading activity from Schwab\u2019s millions of client accounts to illuminate what investors were actually doing and how they were positioned in the markets each month.<\/p>\n

This press release features multimedia. View the full release here: https:\/\/www.businesswire.com\/news\/home\/20250106221369\/en\/<\/a><\/p>\n

\"Schwab<\/p>\n

Schwab Trading Activity Index vs. S&P 500 (Graphic: Charles Schwab)<\/p>\n<\/div>\n

\nThe reading for the four-week period ending December 27, 2024, ranks \u201cmoderate low\u201d compared to historic averages.<\/p>\n

\n\u201cSchwab clients increased their exposure to equities in December, even as major indices experienced atypical swings and turbulence,\u201d said Joe Mazzola, Head Trading & Derivatives Strategist at Charles Schwab. \u201cWe didn\u2019t see a significant \u2018Santa Claus Rally\u2019 this year, but investor sentiment appeared bullish, particularly at the start and end of the month. Many clients appeared to close out the year by rebalancing their portfolios, adding exposure to underperforming sectors such as Health Care and Energy and trimming positions in outperformers like Information Technology and Communication Services.\u201d<\/p>\n

\nU.S. equity markets hovered near their recent all-time highs for the first half of the December period as a muted CBOE Volatility Index (VIX) traded near 14, belying what was to come.<\/p>\n

\nThe U.S. Bureau of Labor Statistics released its Employment Situation Summary on December 6, which showed that non-farm payrolls rose by 227,000, more than anticipated, and the unemployment rate (4.2%) ticked higher, in line with expectations. The S&P 500\u2019s reaction was muted, trading down slightly the following day. On December 11, the Consumer Price Index (CPI) came in as expected at 2.7% for the trailing 12 months, including a 0.3% monthly increase. On December 12, an increase in the Producer Price Index (PPI) was reported as unexpectedly hot at 0.4%. Equity markets largely shrugged this off while the yield on the 10-year Treasury Note rose by 1.73% to 4.399%.<\/p>\n

\nWhile the Federal Open Market Committee (FOMC) statement on December 18 did not suggest a major pivot, the Committee\u2019s 2025 outlook postulated that markets may have fewer interest rate cuts to look forward to than had been previously expected. This set off a tantrum that played out in the markets through the remainder of the period, with major indices selling off hard and the VIX spiking above 27. The 2.9% drop in the S&P 500 was its largest since August 5th and represented only the third time the index closed 2% or lower since February 21st, 2023. The S&P 500 did finish moderately lower on the month, by about 1%, though it did manage to finish 24% higher on the year and generate back-to-back years of annual returns greater than 20% for the first time since 1998.<\/p>\n

\nOnce the dust settled after the FOMC meeting, the VIX established a new, somewhat higher baseline, hovering just below 18 in the final days of the period and the year. The 10-year Treasury yield closed at 4.619% \u2013 a full 10% higher than where it closed last period \u2013 suggesting that markets are pricing in a \u201chigher for longer\u201d rate regime even as they wait for new trade and tariff policies to unfold. The U.S. Dollar Index strengthened once again, rising 2.14% to 108.00. Front month WTI Crude Oil futures rose by 2.74%, ending the period at $70.60 per contract.<\/p>\n

\nPopular names bought by Schwab clients during the period included:<\/p>\n