Fund managers flush with an influx of end-of-year bonuses could help US stock indexes hit a new high as the year comes to its end.
The Dow Jones Industrial Average gained 7.5 points from the previous Friday to close the week at 10,883.27 points.
The tech-slanted NASDAQ lost 0.14 percent to 2.249,42 points, but the broader Standard and Poor's 500 index put on a minimal 0.11 percent to end at 1.268.66.
Some analysts said they have high hopes for the final week of trading, even though it is cut short because of holidays.
Marc Pado, US market strategist at Cantor Fitzgerald, said: "The Santa Claus rally is clearly underway. I expect to see the bulls carry the averages to new four-and-a-half-year highs right into next Friday's close."
"Window dressing should focus on the groups that have done well this year," Pado said. "Energy, technology, financials, and industrials have provided leadership. Even those groups that have underperformed for the year have picked up quite a bit in the last quarter."
Pado said that people who got bonuses in December put much of the money into funds "so that's why after Dec. 15, things tend to get better."
Other analysts say however that future market moves are uncertain and are cautioning against bold moves before the end of the year.
"In my experience the market doesn't remain trapped in that kind of narrow trading range for long," said Ken Tower, chief market strategist at Cyber Trader.
"So expect the market to break out. But which way?" he said.
Briefing.com analysts also said "don't get carried away" in their latest report.
Pado said he feared that fourth quarter profits could be hit by higher energy costs.
Peter Cardillo, an analyst at SW Bach, said however that if oil prices fall -- as they have done over the past week below US$60 a barrel -- then the end-of-year rally could continue into next year.
Briefing.co also said it was "moderately bullish" about the long term future of stocks.
"In that, we place an emphasis on the `moderate' part of the phrase. The fundamentals are reasonably good for stocks, but a big up year for 2006 does not appear to be in the cards," Briefing.co said.
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