Stock Market Recap: Why Was the Market Up Today? November 20, 2024
Major Indexes Performance
On Wednesday, November 20, 2024, the U.S. stock market experienced a mixed session as investors eagerly awaited Nvidia’s quarterly earnings report. The S&P 500 closed down 0.56% at 5,916.98, while the Dow Jones Industrial Average fell 0.12% to 43,268.94. The Nasdaq Composite declined 0.75%, reflecting the tech-heavy index’s sensitivity to the upcoming Nvidia results.
Key Factors Driving Market Movement
1. Nvidia Earnings Anticipation: The market’s primary focus was on Nvidia’s (NVDA) earnings report, scheduled for release after the closing bell. Investors expect the AI chipmaker to report record Q3 revenue of $33.25 billion and forecast Q4 revenue of $37.1 billion. Nvidia’s stock was down about 1.5% in anticipation.
2. Retail Sector Woes: Target (TGT) shares plummeted over 20% after the retailer reported weaker-than-expected Q3 results and cut its full-year outlook due to flat sales and inventory buildup. This negative sentiment spread to other retail stocks, contributing to market weakness.
3. Health Insurance Sector Boost: Health insurance stocks climbed following the nomination of Mehmet Oz to lead the Centers for Medicare and Medicaid Services. Humana (HUM) and UnitedHealth Group (UNH) were among the top gainers in the Dow Jones Industrials.
4. Geopolitical Developments: Reuters reported that Russian President Putin expressed willingness to discuss a cease-fire deal in Ukraine with U.S. President-elect Trump, potentially easing geopolitical tensions in Europe.
5. Federal Reserve Commentary: Fed Governor Cook’s comments suggested a gradual move towards a more neutral policy stance, with the timing and magnitude of rate reductions dependent on incoming economic data.
Notable Stock Movements
– Williams-Sonoma (WSM): Up over 27% after beating Q3 earnings expectations.
– Wix.com (WIX): Gained more than 13% after raising its full-year revenue forecast.
– Comcast (CMCSA): Rose about 1% following plans to spin off several cable channels into a separate public company.
– Apple (AAPL), Microsoft (MSFT), Tesla (TSLA), Amazon (AMZN), and Alphabet (GOOGL): All experienced declines, contributing to the overall market weakness.
Upcoming Market Events
1. Nvidia Earnings: The highly anticipated Q3 results from Nvidia, due after market close, are expected to significantly impact market sentiment, especially in the tech sector.
2. Federal Reserve Watch: Markets are pricing in a 56% chance of a 25 basis point rate cut at the December 17-18 FOMC meeting.
3. Treasury Auction: The U.S. Treasury is set to auction $16 billion of 20-year T-bonds, which could impact bond yields and, consequently, equity markets.
Economic Indicators
– Mortgage Applications: U.S. MBA mortgage applications rose 1.7% in the week ended November 15, with the purchase mortgage sub-index up 2.0%.
– Interest Rates: The 10-year T-note yield increased by 1.2 basis points to 4.408%.
Market Outlook
As the market digests mixed corporate earnings and awaits Nvidia’s report, investors remain cautious. The tech sector’s performance, particularly Nvidia’s results, could set the tone for market direction in the coming days. Additionally, ongoing geopolitical developments and Federal Reserve policy expectations continue to influence investor sentiment.
The stock market’s performance today reflects a delicate balance between positive factors like potential geopolitical easing and negative pressures from the retail sector. As we move forward, keep an eye on Nvidia’s earnings, upcoming economic data, and any shifts in Federal Reserve rhetoric for clues about the market’s next moves.
