Stocks Gaining Momentum: Market Updates
Last week, the stock market saw gains across major indices, rebounding from previous losses despite uncertainties surrounding the incoming Trump administration and geopolitical tensions related to the Russia-Ukraine conflict. There were broad gains, with smaller-cap indexes outperforming larger-cap ones. By the end of the week, the S&P 500 Index (SPX) gained 1.7%, the Russell 2000 (RUT) gained 4.5%, and the NASDAQ Composite rose nearly 1.8%. Year-to-date, SPX is up almost 27%, while RUT has gained just over 20%. Bitcoin also continued to surge post-election, with investors optimistic about reduced regulatory burdens under the new administration.
NVIDIA’s third-quarter earnings report on Wednesday largely met investor expectations, with the utilities sector seeing strong performance driven by interest in clean energy related to artificial intelligence. However, communication services stocks lagged due to Alphabet’s (formerly Google) shares dropping after reports of a potential breakup by the Justice Department.
Later in the week, the Department of Labor reported a decline in initial jobless claims and an increase in existing home sales for October, contributing to positive investor sentiment. Attention remains on the upcoming Federal Reserve meeting in December, with Fed speakers adopting a more hawkish tone recently, focusing on labor market and inflation pressures.
U.S. Treasuries showed positive returns leading into Friday, with mixed movement across the yield curve. Short-term yields rose while long-term yields fell. Municipal bond yields were slightly lower, with strong demand in the primary market. With the third-quarter earnings season wrapping up, over 95% of S&P 500 companies have reported, with 75% beating consensus estimates.
Looking ahead, the coming week will have a limited amount of economic data before the Thanksgiving holiday. The Federal Open Market Committee (FOMC) minutes on Tuesday will be closely watched for signals on future rate cuts. Wednesday will bring GDP revisions and inflation data, which could influence FOMC policy decisions and market movements. Wishing you a Happy Thanksgiving and we will be back in mid-December after a break on Dec. 2.
