 | AUTHOR: Jason Roque, CFP®, APMA®, AWMA® TITLE: Investment Adviser Rep – CCO TAGS: S&P 500, NASDAQ, Homes, FRB, GDP, PCE |
Markets rose for the week. Will Santa fizzle out or make good and deliver a year end bounce?
Monday S&P 500 0.20% | NASDAQ 0.07%
Building permits strengthened, however new home sales fell more than expected. Markets maintained a positive environment till late in the day, ending just below breakeven. There is much to weigh this week as investors may be waiting for more information on GDP and inflation.
Tuesday S&P 500 0.10% | NASDAQ 0.29%
Consumer confidence showed unexpected signs of life on the day, a welcome sign in the middle of the holiday season. Federal Reserve Board (FRB) Governor Waller made indication that the current level of rate may be sufficient to curb inflation. This is especially important as Gov. Waller tends to be a rate hawk. This was a message that likely helped markets end in the green.
Wednesday S&P 500 0.09% | NASDAQ 0.16%
GDP was revised up for the Third quarter to 5.2% from 4.9%. The news should have sparked a rally in markets… quite the opposite. The strength of the economy leads to concern of further rate hikes, which led to softer equities. The GDP movement will have little impact on future rate hikes, but the implication carried weight on the day.
Thursday S&P 500 0.38% | NASDAQ 0.23%
Core PCE data out Thursday pointed to softer inflation. This metric is the FRB’s preferred measure of inflation. The news boosted markets on the final day of trading for the month. The S&P 500 ended up gaining 8.92%, while the NASDAQ gained 10.70%.
Friday S&P 500 0.59% | NASDAQ 0.55%
December opened on solid footing, but not because of Manufacturing. The reading from ISM came in cooler than expected and remained in contractionary territory. The real mover on the day was comments from FRB Chairman Powell. He made it sound like it was unlikely that they would move rates higher. He also made an indication that it was too soon to discuss rate cuts next year. Apparently, markets took that to mean that the rate cuts were happening…
Conclusion S&P 500 0.77% | NASDAQ 0.38%
It was another mild but green week for markets. The strength should persist as we move through December and into the “Santa Claus Rally”. The consumer has showed early strength as Black Friday through Cyber Monday amounted to a 5.4% increase over last year. A good indication of what should be ahead for Santa.
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