2025 Santa Claus Rally Analysis: Historical Trends and 5 Potential Outperforming Stocks

This analysis draws from a Benzinga article [1] published December 16, 2025, which examines the potential for a Santa Claus Rally—defined as the last five trading days of the current year and first two of the new year [1]. Historical trends support this seasonal optimism: since 1950, the S&P 500 has averaged a 1.4% gain in December (74% of years ending higher) [2], and over the past four decades, December returns for the index have averaged 1.44% [3]. On the event date, the S&P 500 closed at 6,795.53, down 0.07% [0], following minor fluctuations in early December. Five stocks were identified as potential outperformers based on historical December seasonality and sector relevance:

• RTX (defense/aerospace): $179.98 (-1.17%), $240.94B market cap, 36.88 P/E [0]
• UL (consumer goods): $64.39 (-1.01%), $140.97B market cap, 21.83 P/E [0]
• SO (utilities): $85.54 (-0.53%), $94.07B market cap, 21.28 P/E [0]
• AMZN (e-commerce/retail): $222.44 (-0.04%), $2.38T market cap, 31.42 P/E [0]
• WMT (retail): $115.48 (-1.12%), $920.70B market cap, 40.38 P/E [0]
  While all closed slightly down on December 16, historical seasonal patterns suggest they may still benefit from the Santa Claus Rally in remaining December weeks [0].

1. Sector Alignment with Year-End Trends
   : The identified stocks span sectors that historically perform well in late December: retail (AMZN, WMT) benefits from holiday shopping demand, utilities (SO) provide stability during market volatility, defense (RTX) may see year-end government spending, and consumer goods (UL) maintain consistent demand [0].
2. Historical Consistency vs. 2025 Uncertainty
   : The Santa Claus Rally has a strong historical track record, but past performance does not guarantee future results. Current market fluctuations (early December S&P 500 declines) and external variables could disrupt the trend [0].
3. Valuation Disparities
   : Walmart (WMT) trades at a relatively high P/E ratio (40.38), which may limit upside potential compared to lower-valuation peers like UL and SO [0].

• Seasonal tailwinds for the S&P 500 and identified stocks based on 70+ years of historical data [2].
• Retail stocks (AMZN, WMT) could benefit from last-minute holiday shopping and post-holiday sales momentum [0].

• Market Volatility
  : External factors (geopolitical tensions, economic data releases, monetary policy decisions) could disrupt the seasonal trend [0].
• Stock-Specific Risks
  :
  • RTX: Exposure to defense spending changes and geopolitical events.
  • UL: Global supply chain disruptions and currency risks.
  • SO: Regulatory changes and commodity price fluctuations.
  • AMZN/WMT: Competitive pressures and shifting consumer spending patterns.
• Valuation Risks
  : WMT’s high P/E ratio may make it less attractive for year-end gains [0].

The Benzinga article [1] highlights the Santa Claus Rally as a potential year-end market trend, with historical data supporting S&P 500 December strength. Five stocks (RTX, UL, SO, AMZN, WMT) are identified as potential outperformers, though all closed slightly down on the event date. Decision-makers should monitor external market factors, stock-specific catalysts, and current sentiment to gauge the rally’s likelihood in 2025. No prescriptive investment recommendations are provided.