Stocks are drifting in morning trading on Wall Street Thursday but remain on track for their best monthly gain in more than a year. The S&P 500 fell 0.1% in morning trading, but remains up more than 8% in November. The Dow Jones Industrial Average rose 244 points, or 0.7%, to 35,676 as of 10:11 a.m. Eastern. The Nasdaq fell 0.4%.
Quick Read
- Wall Street Trading Trends: In Thursday morning trading, stocks on Wall Street showed mixed movements, with the S&P 500 slightly down, but the Dow Jones rising and the Nasdaq falling.
- November Gains: Despite the day’s mixed performance, the S&P 500 remains on track for over an 8% gain in November, potentially its best monthly gain in over a year.
- Treasury Yields Increase: The yield on the 10-year Treasury note rose, impacting mortgage rates.
- Investor Optimism on Federal Reserve Policy: The market’s recent upward trend reflects investor optimism that the Federal Reserve might stop raising interest rates, supported by a report showing cooling inflation.
- Cooling Inflation Report: A Commerce Department report indicated a slowdown in inflation, with unchanged prices from September to October and a decrease in the annual consumer price rise.
- Federal Reserve’s Interest Rate Policy: The Fed’s aggressive rate hikes aimed at controlling inflation have brought rates to their highest in two decades by mid-2023, with expectations of maintaining or potentially cutting rates in the near future.
- Economic Data Influence on Fed Policy: Future Federal Reserve actions are expected to be data-driven, with recent economic growth and consumer confidence data suggesting a possible “soft landing” without causing a recession.
- Corporate Earnings Impact: Positive earnings reports from companies like Salesforce and Snowflake have bolstered investor confidence in business and economic resilience.
- Mixed Company Performance: While some companies reported strong forecasts, others like Pure Storage saw stock declines due to less favorable financial outlooks.
- U.S. Job Market Data: Slight increases in jobless claims were reported, along with the highest level of benefit collectors in two years, indicating a strong but softening labor market.
- European Inflation Decrease: In Europe, inflation dropped to 2.4% in November, aligning closely with the European Central Bank’s target following a series of interest rate hikes.
- Global Stock Market Performance: Asian and European stock markets mostly experienced gains.
The Associated Press has the story:
Wall Street drifts but remains on track for big gains in November
Newslooks- NEW YORK (AP)
Stocks are drifting in morning trading on Wall Street Thursday but remain on track for their best monthly gain in more than a year.
The S&P 500 fell 0.1% in morning trading, but remains up more than 8% in November. The Dow Jones Industrial Average rose 244 points, or 0.7%, to 35,676 as of 10:11 a.m. Eastern. The Nasdaq fell 0.4%.
Treasury yields gained ground. The yield on the 10-year Treasury, which influences mortgage rates, rose to 4.34% from 4.26% late Wednesday.
The market has been marching steadily higher in recent weeks as investors hope the Federal Reserve is finally done raising interest rates, which fight inflation by slowing the economy. Those hopes got more support with a report that the Fed’s preferred measure of inflation cooled last month.
Thursday’s report from the Commerce Department said prices were unchanged from September to October, down from a 0.4% rise the previous month. Compared with a year ago, consumer prices rose 3% in October, below the 3.4% annual rate in September. That was the lowest year-over-year inflation rate in more than 2 1/2 years.
The Fed’s aggressive rate hike policy pushed its benchmark interest rate from near zero in 2022 to its highest level in two decades by the middle of 2023. The goal has been to tame inflation back to the Fed’s target rate of 2%.
Wall Street is betting that the central bank will continue to hold rates steady at its December meeting and into early 2023, when it could start considering cutting interest rates. Fed officials have hinted at those possibilities, while also saying any future moves will be based on economic data.
The latest data on economic growth and consumer confidence have also raised hopes that the Fed will achieve its sought-after “soft landing,” which involves cooling the inflation without throwing the economy into a recession. Meanwhile, the latest round of surprisingly encouraging corporate earnings gave investors more confidence that businesses and the economy can keep humming along.
Software company Salesforce jumped 7.5% after giving investors a strong profit forecast. Cloud-computing company Snowflake rose 5.9% after also giving Wall Street an encouraging financial forecast.
On the losing end, data storage company Pure Storage fell 15.5% after giving investors a disappointing revenue outlook.
Also Thursday, the Labor Department said slightly more Americans filed for unemployment benefits last week, but the overall number of people in the U.S. collecting benefits rose to its highest level in two years. The report shows that the labor market remains strong, but is showing signs of softening.
In Europe, the latest data showed that inflation dropped more than expected to 2.4% in November, the lowest in more than two years. The new figure is close to the European Central Bank’s inflation target of 2% following a rapid series of interest rate hikes dating to summer 2022.
Stocks in Asia and Europe were mostly higher.
