S&P 500 closes lower, Nasdaq sheds 1% as bond yields pop

Stocks were mixed Tuesday.

The Dow Jones Industrial Average rose 37.63 points, or 0.11%, to finish at 33,241.56. The S&P 500 fell 0.4% to settle at 3,829.25, while the Nasdaq Composite shed 1.38% to end at 10,353.23.

— Samantha Subin

The current market is performing in line with how bear markets typically have in the past, according to Michael Reynolds, vice president of investment strategy at Glenmede.

He said the average bear market since World War II has lasted 14 months. And the market usually sees 35.7% drop from the pre-bear high.

“The current market appears to be following a similar trajectory of an average historical bear market so far,” Reynolds said.

Reynolds pointed to the S&P 500 ending last week down 0.2%. It was about 7% off its late-November high, which he said can be taken to mean the end of “yet another bear market rally.”

He said investors should consider staying underweight on risk assets considering there may be further slides.

— Alex Harring

Some 74 SPAC deals have liquidated in December, according to SPAC Research, as the blank-check companies wrap up a difficult year in an ugly market.

Year to date, a total of 128 special purpose acquisition companies have liquidated, compared to one SPAC liquidation in all of 2021, SPAC Research found.

SPACs have faced a rough 2022. These companies typically pool funding to identify and finance an acquisition of a smaller company and bring it public within a particular time frame.

Investors have become increasingly risk averse amid this year’s market tumult, curtailing the appetite for SPACs. The liquidations arrive as many of these companies reach the end of the time allotted for them to identify a target and merge with it. More than 600 SPACs priced in 2021, driving this year’s spike in liquidations.

Major names that have liquidated in December include Brad Gerstner’s Altimeter Growth 2. Crypto firm Bullish and Far Peak Acquisition also called off their merger this month.

— Darla Mercado, Gina Francolla

The folks at Birinyi Associates on Tuesday needed to play Scrooge and throw cold water on the idea that a Santa Claus Rally is an investment approach that has proven profitable in the past generation.

Their conclusion? The Santa Claus Rally is a myth, at least as shown in data going back to 2000.

In only two years (2001 — almost +6%, and 2009 — more than +7%) would investors have seen an appreciable return during that supposed, sure-thing, can’t miss stretch starting at Christmas and running through the first two trading days of the following year.

The average gain since 2000? 0.76%.

“In effect if you buy JPM at $130 you should according to the SCR yield 98 cents…Making 98 cents on a $130 investment does not strike us as a good investment policy or approach,” the note from Birinyi’s Joshua Rubin said.

— Scott Schnipper

The selloff in Tesla shares continued Tuesday, putting the electric…