Stock Market Today: S&P 500 and Nasdaq Hit Fresh Highs Amid Fed Speculation

Market Performance: Major Indexes Reach New Records

On Wednesday, December 4, 2024, the U.S. stock market continued its bullish trend, with the S&P 500 and Nasdaq Composite reaching fresh all-time highs. As of 11:36 a.m. ET, the Dow Jones Industrial Average (.DJI) experienced a slight dip of 169.17 points (0.37%) to 44,615.46. Meanwhile, the S&P 500 (.SPX) edged lower by 6.98 points (0.11%) to 6,040.22, and the Nasdaq Composite (.IXIC) gained 22.13 points (0.12%) to 19,427.37, briefly touching a new record high.

Pre-Market Indicators and Futures

The positive momentum was evident in pre-market trading, with futures pointing to a strong opening. Dow Jones Industrial Average futures (YM=F) climbed 0.5%, or over 200 points. S&P 500 futures (ES=F) added 0.3%, building on the previous session’s all-time closing high. The tech-heavy Nasdaq 100 futures (NQ=F) led the way with a 0.7% gain, setting the stage for potential new records.

Why Is the Market Up Today?

Several factors are contributing to the market’s upward trajectory:

1. Tech Sector Strength: The technology sector continues to drive market gains. Salesforce (CRM) stock surged around 13% in pre-market trading following strong quarterly results, particularly in its AI products. Other tech companies like Okta (OKTA) and Marvell (MRVL) also saw significant jumps after positive earnings reports.

2. Federal Reserve Speculation: Investors are eagerly anticipating Federal Reserve Chair Jerome Powell’s appearance in New York later today. The market is seeking clues about the potential for interest rate cuts, with growing confidence in a December rate reduction. Traders currently see a 74% probability of a 25 basis point cut at the Fed’s December 18 meeting, up from 66% a week ago.

3. Labor Market Data: A Labor Department report showed a moderate increase in U.S. job openings in October, while layoffs declined. This suggests the labor market is cooling in an orderly fashion, potentially supporting the case for Fed easing.

Upcoming Market Events

Several key events are on the horizon that could impact market performance:

1. November Payrolls Report: The highly anticipated monthly payrolls figures, due on Friday, will be crucial in gauging the Fed’s interest rate trajectory.

2. ADP Private Payrolls Report: A reading on private payrolls for November is scheduled for release on Wednesday, providing additional insight into the labor market’s health.

3. Fed Officials’ Comments: Investors will be parsing through comments from Chicago Fed President Austan Goolsbee and Fed Board Governor Adriana Kugler for further indications of the central bank’s stance.

Major Stock News

Several notable stocks are making headlines:

Tesla (TSLA): The electric vehicle maker saw its stock slip 1.5% after reporting a 4.3% year-on-year decline in sales of China-made vehicles for November.
Zscaler (ZS): The cybersecurity firm’s shares dropped 5.7% following a second-quarter revenue forecast that failed to impress analysts.
U.S. Steel (X): The company’s stock shed 7.9% after former President Donald Trump reiterated his opposition to Nippon Steel’s planned $15 billion purchase of the company.

Market Breadth and Sector Performance

Market breadth indicates a cautious sentiment, with declining issues outnumbering advancers by a 1.62-to-1 ratio on the NYSE and a 1.89-to-1 ratio on the Nasdaq. Seven of the 11 major S&P sub-sectors were trading lower, with the industrials sector (.SPLRCI) leading the declines with a 0.9% fall.

Global Market Influences

International events are also impacting U.S. markets. U.S.-listed shares of South Korean companies, represented by the iShares MSCI South Korea ETF (EWY.P), fell 3% following President Yoon Suk Yeol’s declaration of martial law in the country. Additionally, political turmoil in France and the potential for a no-confidence vote are keeping investors alert to global risks.

As the market continues to navigate through economic data, Fed speculation, and global events, investors remain cautiously optimistic. The current rally, particularly in the tech sector, underscores the market’s resilience and the ongoing search for growth opportunities in an evolving economic landscape.

Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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