Stock Market Recap: Why Was the Market Up Today? – November 13, 2024
Major Indexes Close Mixed as Inflation Data Boosts Rate Cut Hopes
The U.S. stock market finished Wednesday, November 13, 2024, with mixed results as investors digested the latest inflation data and its potential impact on future interest rate decisions. The S&P 500 ended essentially flat, inching up just 1.39 points (0.02%) to close at 5,985.38. The Dow Jones Industrial Average (DJIA) edged higher by 47.21 points (0.1%), finishing at 43,958.19, while the Nasdaq Composite slipped 50.66 points (0.3%) to 19,230.74.
Inflation Report Strengthens Rate Cut Expectations
The day’s trading was largely influenced by the release of the Consumer Price Index (CPI) report, which showed that inflation rose 0.2% last month, with the annual inflation rate coming in at 2.6%. These figures were in line with economists’ expectations, reinforcing the belief that the Federal Reserve might implement another interest rate cut in December.
This sentiment was reflected in the Treasury market, where yields were mixed. The 10-year Treasury yield settled slightly higher at 4.44%, after dipping as low as 4.36% immediately following the inflation report. The market’s reaction suggests growing confidence that the Fed will continue its accommodative monetary policy in the near term.
Sector Performance and Market Breadth
Despite the relatively flat performance of the major indexes, there was significant divergence among sectors. The Consumer Discretionary (XLY), Health Care (XLV), Real Estate (XLRE), Materials (XLB), and Utilities (XLU) sectors all experienced notable declines, ranging from 1.2% to 1.7%.
Market breadth was decidedly negative, with decliners outnumbering advancers on the NYSE by a 3.48-to-1 ratio. On the Nasdaq, declining issues led advancing ones by a 2.27-to-1 margin. The CBOE Volatility Index (VIX), often referred to as the “fear gauge,” decreased by 1.7% to 14.71, indicating a slight easing of market anxiety.
Earnings Season Update and Notable Stock Movements
As the third-quarter earnings season winds down, the overall results have been largely positive. Of the 455 S&P 500 companies that have reported so far, 73.5% have beaten earnings per share (EPS) estimates, while 61.5% have surpassed revenue expectations. Total earnings for these companies are up 7.1% year-over-year on 5.5% higher revenues.
In company-specific news, Live Nation Entertainment Inc. (LYV) reported mixed third-quarter results. The company’s adjusted EPS of $1.66 beat analysts’ estimates, but revenues of $7.7 billion fell short of expectations.
Tesla Inc. (TSLA) continued its recent rally, gaining approximately 0.5% during the session. The electric vehicle maker has seen its stock surge more than 30% over the past week, fueled by optimism surrounding CEO Elon Musk’s relationship with the president-elect and potential benefits from upcoming economic policies.
Upcoming Market Events to Watch
Investors should keep an eye on several key events in the coming days that could impact market sentiment:
1. Federal Reserve speeches: Several Fed officials are scheduled to speak, potentially providing insights into future monetary policy decisions.
2. Retail sales data: The release of October’s retail sales figures will offer a glimpse into consumer spending habits heading into the holiday season.
3. Earnings reports: While the bulk of earnings season has passed, some notable companies are still set to report, including major retailers.
Market Outlook and Investor Sentiment
As we move further into November, market participants remain cautiously optimistic. The recent rally following the presidential election has shown signs of fatigue, with profit-taking emerging in some sectors. However, the prospect of continued accommodative monetary policy and potential fiscal stimulus measures under the new administration continues to provide support for equities.
Investors are advised to maintain a balanced approach, keeping an eye on inflation trends, interest rate developments, and the ongoing economic recovery as we head towards the end of 2024. The mixed market performance today underscores the importance of diversification and careful stock selection in navigating the current investment landscape.
In conclusion, while the stock market’s performance on November 13, 2024, was relatively muted, the underlying currents of inflation data, earnings reports, and sector rotations continue to shape the financial narrative. As always, staying informed and adaptable remains key to successful investing in these dynamic market conditions.
