Weekly Market Recap – December 1, 2023
The major U.S. stock indexes secured their fifth consecutive positive week, although the pace of upward movement slowed during a mostly tranquil week of trading. The Dow registered an increase of more than 2%, while the S&P posted a fractional gain, propelling both indexes to year-to-date highs.
November emerged as the strongest month this year for the major U.S. stock indexes, significantly offsetting much of the overall decline witnessed in the previous three months. The NASDAQ surged by 10.7%, the S&P 500 rose by 8.9%, and the Dow gained 8.8%.
U.S. government bond prices experienced a surge, resulting in lower yields. Investors seemed to shift their focus toward the potential for future interest-rate cuts rather than anticipating further rate hikes. On Friday, the yield of the 10-year U.S. Treasury bond fell to approximately 4.22%, marking the lowest point in over three months and a substantial decline from the recent peak of 4.99% on October 18.
The government’s initial estimate of third-quarter GDP growth exceeded expectations, and a subsequent update released on Wednesday revealed even more robust growth. The revised annual growth rate reached 5.2%, surpassing the 4.9% initial estimate from October. This acceleration, compared to the 2.1% growth in this year’s second quarter, is anticipated to experience a cooldown in the current quarter, partly due to elevated interest rates.
During the recently concluded earnings season, companies in the S&P 500 reported an average earnings gain of 4.7% over the same quarter a year earlier, as per FactSet data. This outcome marked the first year-over-year earnings increase since the third quarter of 2022, with the communication services sector leading with an impressive earnings growth of 42.0%.
The U.S. Federal Reserve’s preferred indicator for tracking inflation revealed a continued deceleration in consumer prices in October. The Personal Consumption Expenditures Price Index rose at a 3.0% annual rate, down from 3.4% in September. Core inflation, excluding volatile food and energy prices, climbed 3.5% in October, a slight decrease from the 3.7% recorded in September.
On Thursday, the government reported that U.S. consumer spending in October rose at an annual rate of 0.2%, marking the slowest pace in five months. This monthly result represents a notable deceleration from September’s figure of 0.7%.
The upcoming monthly labor market report, set to be released on Friday, will reveal whether the recent slowdown in U.S. jobs growth extended into November. In October, the economy generated 150,000 new jobs, half as many as in September and down from an average of 258,000 over the last 12 months. The unemployment rate for October edged upward to 3.9%.
Major U.S. Economic Reports
Report | Period | Actual | Previous |
New home sales | Oct | 679,000 | 719,000 |
S&P Case-Shiller home price index (20 cities) | Sep | 3.9% | 2.5% |
Consumer confidence | Nov | 102.0 | 99.1 |
GDP (first revision) | Q3 | 5.2% | 4.9% |
Advanced U.S. trade balance in goods | Oct | -$89.8B | -$86.8B |
Initial jobless claims | Nov 25 | 218,000 | 211,000 |
Personal income | Oct | 0.2% | 0.4% |
Personal spending | Oct | 0.2% | 0.7% |
PCE index | Oct | 0.0% | 0.4% |
Core PCE index | Oct | 0.2% | 0.3% |
PCE (year-over-year) | 3.4% | ||
Core PCE (year-over-year) | 3.7% | ||
Chicago Business Barometer (PMI) | Nov | 55.8 | 44.0 |
Pending home sales | Oct | -1.5% | 1.1% |
S&P Global manufacturing PMI | Nov | 49.4 | 49.4 |
ISM manufacturing | Nov | 46.7% | 46.7% |
Construction spending | Oct | 0.6% | 0.4% |
Auto sales | Nov | 15.5 million |
Closing Prices for the Week
Contract | Close |
---|---|
Dow Jones Industrials Average | 36,245.50 |
Nasdaq Composite | 14,305.03 |
S&P 500 Index | 4,594.63 |
CBOE Volatility Index | 12.63 |
S&P GSCI | 548.70 |
U.S. Dollar Index | 103.268 |
10-Year T-Note (Mar ’24) | 110-215 |
Crude Oil WTI (Jan ’24) | 74.07 |
Natural Gas (Jan ’24) | 2.814 |
Gold (Feb ’24) | 2,089.7 |
Silver (Mar ’24) | 25.857 |
Corn (Mar ’24) | 484-6 |
Wheat (Mar ’24) | 602-6 |
Soybean (Jan ’24) | 1325-0 |
Coffee (Mar ’24) | 184.35 |
Sugar #11 (Mar ’24) | 25.09 |
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