Market Recap: S&P 500 and Dow Hit Record Highs as November Ends on a High Note
Market Performance
On Friday, November 29, 2024, the U.S. stock market closed out a stellar month with the Dow Jones Industrial Average and S&P 500 reaching new record highs. The shortened trading session, following the Thanksgiving holiday, saw broad gains across major indexes:
– The S&P 500 (SPX) added 0.56% to close at 6,032.38 points, marking a new all-time high.
– The Dow Jones Industrial Average (DJIA) climbed 188.59 points, or 0.42%, ending at 44,910.65 points, also setting a new record.
– The Nasdaq Composite (COMP) jumped 0.83% to finish at 19,218.17 points, approaching its own record high set earlier this month.
This impressive performance capped off a robust month for equities, with the Dow gaining 7.5% in November, while the S&P 500 and Nasdaq Composite rose more than 5% and 6%, respectively. The small-cap Russell 2000 index outperformed its larger counterparts, surging 11.1% for the month.
Sector Performance and Key Drivers
The market’s upward momentum was partly driven by chip stocks, which rallied on news that the Biden administration was considering less stringent restrictions on semiconductor equipment sales to China than previously anticipated. Notable gainers included:
– Lam Research (LRCX): Up more than 3%
– NVIDIA Corporation (NVDA): Jumped more than 2%
– The iShares Semiconductor ETF (SOXX): Added 1.3%
The broader market saw widespread gains, with approximately three out of every five S&P 500 members finishing the session in positive territory. This broad-based advance propelled the index into uncharted territory.
Economic Indicators and Future Outlook
Recent economic data has painted a mixed picture of the U.S. economy:
– GDP Growth: The Commerce Department reported that the U.S. economy grew at a 2.8% annual pace in the third quarter, unchanged from initial estimates but slower than the second quarter’s 3% growth.
– Consumer Spending: A key driver of economic activity, consumer spending increased 0.4% in October, surpassing expectations of a 0.3% rise.
– Inflation: The Personal Consumption Expenditures (PCE) index, the Federal Reserve’s preferred inflation gauge, climbed 0.2% in October and 2.3% year-over-year. Core PCE, excluding volatile food and energy prices, rose 0.3% month-over-month and 2.8% annually.
– Labor Market: Jobless claims totaled 213,000 for the week ending November 23, showing a slight decrease from the previous week and indicating a resilient job market.
Market Sentiment and Future Expectations
Investors remain optimistic about the market’s trajectory, with some analysts predicting further gains. Rich Ross, a chartered market technician at Evercore ISI, suggests that the S&P 500 could reach 6,300 by year-end, which would represent a 32.1% gain for 2024.
The market’s strength is attributed to several factors:
1. Expectations of potential tax cuts and deregulation following the recent election
2. Stable crude oil prices and inflation
3. Fading dollar strength
4. Treasury yields that have stopped rising
Cryptocurrency Market Update
In the cryptocurrency space, Bitcoin (BTC) is approaching a significant milestone, trading at $98,268.10, up more than 3% and nearing the $100,000 mark. This surge has positively impacted crypto-related stocks:
– MicroStrategy (MSTR): Gained 4%
– Mara Holdings: Jumped 11% after announcing the purchase of additional bitcoins
Looking Ahead
As we move into December, market participants will be closely watching for any signs of a potential year-end rally. With the holiday shopping season in full swing, retail stocks may see increased attention. Additionally, investors will be monitoring upcoming economic data releases and any signals from the Federal Reserve regarding future interest rate decisions.
The strong November performance sets a positive tone for the final month of 2024, but as always, investors should remain vigilant and diversified in their approach to navigate potential market volatility.
