Financial Update: Week of November 25, 2024
I hope your holiday week is off to a great start! Last week was positive for major U.S. stock indexes, a stark contrast to the previous week.
What were investors thinking last week, and what might this holiday week bring for the financial markets? It is time for a quick update!
Index Overview
Tallying major stock indexes last week, the S&P 500 rose by 1.68%, the Nasdaq 100 rose by 1.87%, and the Dow Jones Industrial Average ended the week higher by 1.96%.
The Dow rose by the highest percentage of these three major indices as some slight sector rotation was on display.
U.S Stocks
The S&P 500 and the Dow hit weekly highs last week, as strong data from a business activity index put out by S&P Global showed a 31-month high. This index, which tracks both manufacturing and service sectors, provided a solid backdrop for investors last week, with the consumer discretionary, industrials, and consumer staples sectors all in the conversation.
We also saw strength in small-caps, and value stocks were the rave last week, outperforming their growth counterparts. This tends to occur during periods of sector rotation.
Q3 Earnings Summary
As of last Friday’s market close, 95% of S&P 500 companies have already reported third-quarter earnings.
Of these companies, 75% reported a positive earnings per share (EPS) surprise, and 61% of them reported a positive revenue surprise, according to data from FactSet.
For Q3, the blended year-over-year growth rate of these companies is 5.8%. Should 5.8% be the final growth figure once all S&P 500 companies have reported for Q3, it will mark the fifth consecutive quarter of annual earnings growth for the index.
Market participants love to see continued earnings growth!
Treasury Yields Consolidate
Consolidation was featured in the 10-year note yield as investors weighed the state of the U.S. economy. The quiet move slightly lower in the ten-year yield last week marked the first week of lower yields in the last five.
Shorter duration two-year note yields actually rose last week, settling near 4.379. While the 2/10 yield curve remains “normalized” after its recent “uninversion,” the two-year yield is remarkably close to the ten-year yield as of last week’s market close.
Crypto Breakout
If you like volatility and sharp moves, crypto was the place to be last week. Bitcoin, the largest cryptocurrency by market capitalization, rose sharply and approached the 100,000 level last week, reaching above 99,000 on the Coinbase exchange.
The extremely volatile asset space garnered plenty of attention last week, but will the rally continue? It is anybody’s guess. As a “newer” asset class than virtually all others (no pun intended), the virtual currency space is not for the faint of heart.
The Proshares Bitcoin ETF rose last week by 8.23%, and cryptocurrency exchange Coinbase was close to flat last week after its recent post-election surge in share price.
While it is easy to get caught up in mania surrounding a surging asset price, let’s remember to pour some cold water on ourselves and that a well-diversified long-term portfolio reigns supreme.
Bitcoin was trading at around 96,000 on the Coinbase exchange early Sunday afternoon.
Consumer Sentiment Mixed
Consumer sentiment rose in October, reaching its highest level since April 2024 but coming in below expectations. The index rose 1.3% in October, with the data print showing a 71.8 versus 73.0 expected.
Interpretations of the data print vary, with many analysts indicating a temporary pause in sentiment during the pre-election month.
“All year, consumers have repeatedly told us that the trajectory of the economy hinges on who becomes the next president,” University of Michigan Surveys of Consumers Chief Economist Joanne Hsu said in a statement. “Given the tightness of the race in its final weeks, consumers were fully aware that the result could go either way. Thus, the election had little immediate impact on the overall trajectory of sentiment.”
Other analysis focuses on the data showing the consumer feeling more confident, and many will look to the next monthly print and consumer confidence data (released Tuesday of this week) to firm up the read on the consumer at present.
Holiday Week
It’s an action-packed week, chock full of economic data releases to go with the turkey and pie! Fed meeting minutes from the last policy meeting are due for release on Wednesday, along with a slew of economic data, including GDP data and Core PCE, the Fed’s favorite inflation indicator. So, money managers will be watching with eager eyes.
It is the last full trading week of November, and U.S. stock markets will be closed on Thursday for the Thanksgiving holiday. An abbreviated trading session will occur on Black Friday for U.S. stocks.
It’s sure to be an active week, full of thanks and holiday cheer! Hope you have a wonderful Thanksgiving. As always, don’t hesitate to reach out with any questions or concerns. I am always here as a resource for you.
Disclosure:
This material provided by Levitate. Levitate is not affiliated with Valmark Securities, Inc. and Valmark Advisers, Inc. Indices are unmanaged and do not incur fees, one cannot directly invest in an index. Diversification does not guarantee investment returns and does not eliminate the risk of loss. Past performance does not guarantee future results. The information provided has been derived from sources believe to be reliable, but is not guaranteed as to accuracy and does not purport to be complete analysis of the material discussed, nor does is constitute an offer or a solicitation of an offer to buy any securities, products or services mentioned.
Disclosure:
This material provided by Levitate. Levitate is not affiliated with Valmark Securities, Inc. and Valmark Advisers, Inc. Indices are unmanaged and do not incur fees, one cannot directly invest in an index. Diversification does not guarantee investment returns and does not eliminate the risk of loss. Past performance does not guarantee future results. The information provided has been derived from sources believe to be reliable, but is not guaranteed as to accuracy and does not purport to be complete analysis of the material discussed, nor does is constitute an offer or a solicitation of an offer to buy any securities, products or services mentioned.