CNBC Daily Open: For the S&P, the last mile’s the longest

This report is from today’s CNBC Daily Open, our new, 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.

Just a bit more to go
U.S. markets were mostly flat Thursday, with the S&P 500 on the cusp of a record close. The Dow Jones Industrial Average was the only major index to eke out a convincing gain. Across the Atlantic, the pan-European Stoxx 600 index dipped 0.11%, with bank stocks dropping around 0.5%.

Xiaomi enters EV market
Chinese consumer electronics company Xiaomi revealed an electric vehicle, the Xiaomi SU7, that will be its first entrant into the country’s crowded EV market dominated by Tesla and BYD. Xiaomi CEO Lei Jun said the car “is in trial production and it will hit the domestic market in a few months,” and that “the price has not been finalized yet.”

Investor confidence affirmed
Shares of point-of-sale lender Affirm rocketed 430% this year, outperforming all other U.S. technology companies valued at $5 billion or more. Affirm shares got a particular big boost in November after the company expanded a partnership with Amazon, and buy now, pay later purchases hit an all-time high on Cyber Monday.

The most magnificent one
Out of the “Magnificent 7” technology stocks, Microsoft’s the favorite of the 300 investors, traders and money managers surveyed by CNBC’s Delivery Alpha Stock Survey, with 44% saying they’d pick the stock first. More than three-quarters of respondents also think the “Magnificent 7” stocks will continue outperforming the other 493 S&P 500 stocks in 2024.

[PRO] Negative year for U.S. dollar
As U.S. inflation subsides and interest rates peak, the U.S. dollar’s beginning to weaken. In fact, it’s headed for its first negative year since 2020. CNBC’s Jeff Cox looks at how the dollar’s faring against other major foreign currencies, and what analysts have to say about the currency’s movements.

The S&P 500‘s tantalizingly close to an all-time high. The index added 0.04% yesterday to close at 4,783.35, just about 10 points away from its record closing level of 4,796.56.

But another way of thinking about it is that investors are nervous about breaching that barrier. A 0.04% gain, in all respects, is negligible. It’s probably fairer to say the S&P was unchanged yesterday.

That sense of trepidation extended to the Nasdaq Composite, which made the barest move downward, dipping 0.03%. Only the Dow Jones Industrial Average, which added 0.14%, moved more than 10 basis points.

Perhaps there’s some recognition among investors that the S&P, with its 26% gain year to date, is already overvalued. Scott Wren, Wells Fargo‘s senior global market strategist, told clients the S&P was trading ahead of its fair value.

Still, despite “every chance in the world for the market to fall,” the market “refuses to fall in a meaningful fashion,” said Adam Sarhan, CEO of 50 Park Investments. That shows “extreme resilience” in the market and that “the bulls remain in clear control.”

With just one trading day left for 2023 and the S&P within a hair’s breadth of its peak, all the bulls need to end the year with a bang is to trot forward gently.

And that’d be the best cap to a year during which the S&P, rather incredibly, is nearing a record close despite the Russia-Ukraine war persisting, facing a banking crisis, oil supply cuts by OPEC+, the 10-year Treasury yield hitting 5%, the Israel-Hamas war — among other geopolitical and economic risks.

This newsletter will be back Tuesday, Jan. 2, 2024, when, depending on whether the S&P managed to give investors a final present for 2023, we’ll dissect what went right or wrong.

Happy new year in advance, and may you and your loved ones have a safe, prosperous and healthy 2024. Thank you for an incredible first year of CNBC Daily Open.