Traders at the New York Stock Exchange were busy as stock futures showed little movement on a recent Tuesday night following two days of gains for major averages. Futures linked to the Dow Jones Industrial Average rose slightly by 21 points, while S&P and Nasdaq 100 futures stayed nearly flat.
Despite some ups and downs during trading, all three U.S. stock indexes ended the day higher. The Dow closed up more than 660 points, a solid gain of 1.4%, marking its third day of gains. Tech stocks played a big role in lifting the market. For instance, Alphabet reached new highs based on reports that Meta Platforms might use Alphabet’s TPU chips by 2027. In contrast, chipmaker Nvidia saw a drop of over 2.5%.
Clark Bellin, president and chief investment officer of Bellwether Wealth, noted that stocks seem to be rebounding from recent declines, with only a 4% drop from late October highs, which is below the average correction threshold of 10%. He cautioned, however, that while the market could regain its highs, there aren’t many clear reasons for a strong push upwards before the end of the year.
Investors are watching for any signals that could impact the Federal Reserve’s plans for interest rates. Currently, there’s about an 85% chance the Fed will cut rates by a quarter point in December. Treasury Secretary Scott Bessent mentioned that Trump might announce the next Fed chair before Christmas. Kevin Hassett, the National Economic Council Director, is being seen as a frontrunner for the role and is likely to advocate for lower rates.
November has turned out to be a tough month for the stock market. All three major indexes are poised for declines due to concerns over high valuations, especially in tech. So far, the S&P 500 has dropped about 1.1%, while the tech-heavy Nasdaq Composite shed nearly 3%. The Dow is down approximately 1% this month.
In summary, while the market is trying to recover, many eyes are focused on interest rate decisions and upcoming leadership changes at the Fed. Understanding these dynamics is crucial for anyone looking to navigate the current investment landscape.
For further insights, you can explore the CME FedWatch tool to see the latest expectations for the Fed’s interest rates.
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