The seven-year U.S. bull market has new life going into the new year, thanks to a slow-moving Federal Reserve and a surprising election sweep by Republicans, which is raising hopes for regulatory-policy easing and fiscal stimulus.

While the Fed is widely expected to raise rates this week and in 2017, it’s seen moving at a gradual pace, as other central banks around the world continue easing. Investors are cautiously optimistic, with many expecting modest U.S. and global economic growth.

Tempering...