The Weekly Update
Week of November 11th, 2024
By Christopher T. Much, CFP®, AIF®
Stocks surged higher last week, fueled by the Fed’s rate cut decision and post-election enthusiasm as investors looked to future policy impacts of a Republican-controlled Senate and executive branch. (The House of Representatives still remains officially undecided.)
The Standard & Poor’s 500 Index spiked 4.65 percent, while the Nasdaq Composite Index gained 5.74 percent. The Dow Jones Industrial Average rose 4.61 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, was basically flat (down 0.02 percent).
Stocks Extend Rally on Election News
It was a shaky start to the week for stocks as investors anxiously awaited election results and the Fed’s interest-rate decision.
On Election Day, stocks rallied broadly before polling places closed. After the election was called early the next morning, stocks opened higher and climbed throughout the trading session. The yield on the 10-year Treasury fell to 4.307 percent.
Stocks opened higher Thursday, and the rally picked up momentum after the Federal Reserve approved its second consecutive interest rate cut. Economic news that showed a 2.2 percent rise in third-quarter productivity helped support the move.
Stocks finished the week with a number of records: the S&P 500 crossed the 6,000 mark, and the Dow breached 44,000 for the first time on Friday. While the S&P and Dow closed slightly below those record levels, each had their best week in a year.
Fed Cuts Rates
As expected, the Federal Reserve cut interest rates by a quarter percentage point at its November meeting.
However, Fed Chair Jerome Powell signaled some uncertainty about the pace of future rate cuts, which slightly unsettled the markets.
Citing a desire to “steer between the risk of moving too quickly and perhaps undermining our progress on inflation or moving too slowly and allowing the labor market to weaken too much,” Powell said the Fed will continue to monitor the economy’s progress.
This Week: Key Economic Data
Tuesday: Fed Officials Neel Kashkari and Patrick Harker speak.
Wednesday: Consumer Price Index. Fed Officials Lorie Logan, Alberto Musalem, and Jeffrey Schmid speak. Treasury Buyback Announcement.
Thursday: Producer Price Index. Fed Chair Jerome Powell speaks. Weekly Jobless Claims.
Friday: Retail Sales. Industrial Production. Import and Export Prices. Business Inventories.
Source: Investor’s Business Daily – Econoday economic calendar; November 8, 2024
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
This Week: Companies Reporting Earnings
Tuesday: The Home Depot, Inc. (HD), Shopify Inc. (SHOP), Spotify Technology (SPOT)
Wednesday: Cisco Systems, Inc. (CSCO)
Thursday: The Walt Disney Company (DIS), Applied Materials, Inc. (AMAT), Brookfield Corporation (BN)
Source: Zacks, November 8, 2024
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
