Holiday-thinned markets cheered by strong Wall Street finish

This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

Mega automobile merger
Nissan and Honda have begun official merger discussions, the two companies announced on Monday. Negotiations will end June 2025. Japan-listed Honda shares were last up 13.4% on Tuesday and on track for their best day since October 2008, after the company announced plans to buy back 24% of its issued shares by Dec. 23 next year.

Taiwan tops Asian markets
As of Dec. 23, Taiwan’s Taiex had gained 28.85%, making it the best-performing stock market in Asia-Pacific in 2024. The Taiex’s focus on tech and tech-related stocks helped supercharge its performance. Taiwan Semiconductor Manufacturing Company soared 82.12% in 2024, and Foxconn — which trades as Hon Hai Precision Industry — advanced 77.51%.

Positive start to holidays
U.S. markets rose on Monday on the back of a strong showing by large tech stocks. The New York Stock Exchange closes early Tuesday for Christmas Eve. Asia-Pacific stocks traded mixed on Tuesday. Japan’s Nikkei 225 slipped roughly 0.4% even as Honda shares popped. Meanwhile, Hong Kong’s Hang Seng index climbed more than 1%.

UK GDP not OK
The U.K. economy failed to expand in the three months ending September, according to revised figure from the Office for National Statistics, published Monday. Previous estimates had pegged third-quarter gross domestic product at 0.1%. Earlier this month, data from the ONS showed the U.K. economy had unexpectedly contracted by 0.1% in October.

[PRO] Buffett’s biggest war chest
Warren Buffett’s Berkshire Hathaway is currently holding $325 billion in cash — the largest amount it’s hoarded in absolute terms. Cash now comprises around 30% of Berkshire’s total assets, the highest proportion in 34 years, according to data from Oppenheimer. Buffett sold large quantities of Apple and Bank of America shares this year. Why is the 94-year-old legendary investor holding on to so much cash? Analysts weigh in.

U.S. markets began the trading week in holiday cheer. The S&P 500 gained 0.73% and the Dow Jones Industrial Average, recovering from earlier losses, ticked up 0.16%. The Nasdaq Composite added 0.98% on the back of strong performances from large tech firms such as Nvidia, Tesla and Meta Platforms.

However, shares of bitcoin proxy MicroStrategy slumped 8.8% on its first day in the Nasdaq-100 index, following the cryptocurrency’s price falling to below $93,000 on Monday.

That said, MicroStrategy is still among the best-performing U.S. tech companies valued at $5 billion or more, according to FactSet data. Its shares have rocketed 426% so far this year, mostly thanks to the company’s stockpile of bitcoins, which it started to amass in 2020.

With the rally in bitcoin following Donald Trump’s election victory, MicroStrategy’s bitcoin holding is now worth around $42 billion. It’s the basis for the company’s market capitalization ballooning to $82 billion from roughly $1.1 billion from the time it began buying bitcoin in bulk.

Investors looking to ride on MicroStrategy’s explosive rise should remember that the company’s share price is currently trading on the back of bitcoin prices.

The flipside of it is that if bitcoin prices crater for any reason — volatile as cryptocurrency can be — MicroStrategy shares may stumble too.

Trading is likely to be thin this week. Markets in the U.S. will close early on Tuesday and take a break on Wednesday for Christmas Day.

But light trading doesn’t mean small moves in markets. “With the market’s primary uptrends still intact, we are not giving up on the potential for a Santa Claus to come to Broad & Wall this year,” Craig Johnson, chief market technician at Piper Sandler, said in a note.

As investors celebrate the festivities — and the S&P’s 25.25% year-to-date pop — they might find an extra present underneath the tree.

— CNBC’s Yun Li, MacKenzie Sigalos and Ari Levy contributed to this report.        

CNBC Daily Open will be on hiatus and return next year. Happy holidays!