Weekly Market Insights

Stocks slid last week as mixed economic data and strong-but-not-spectacular Q3 corporate reports failed to inspire investors.

The Standard & Poor’s 500 Index fell 1.36 percent, while the Nasdaq Composite Index declined 1.50 percent. The Dow Jones Industrial Average edged down 0.15 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, slid 0.96 percent.^1,2

Q3 Reports Uninspired

Stocks rallied early Wednesday after the gross domestic product report showed a strong economy that appeared on the path to a soft landing. However, stocks moved lower throughout the day as investors digested mixed Q3 reports from a few mega-cap tech names.^3,4

Stocks were under more pressure Thursday as disappointing outlooks for some key tech companies pulled the market down. A softer-than-expected jobs report on Friday unsettled investors, but stocks picked up as the day progressed, and attention shifted to how the Fed may interpret the jobs data.⁵

By Friday, the Nasdaq’s eight-week winning streak had ended, and the S&P fell for the second week.

Fed Back in Focus After Jobs Report

At its most recent meetings, the Fed has made it clear that it needed to balance the risks of both inflation and employment.

So Friday’s jobs report that showed 12,000 jobs created in October caught some by surprise. Economists expected the Labor Department to report 100,000, down from September’s 223,000 jobs.⁶

Investors parsed the data and determined the strike at a major aircraft manufacturer and two hurricanes caused the jobs report to fall short of estimates. Investors also appeared to believe the jobs report would prompt the Fed to move on rates at its two-day policy meeting, which ends on November 7.

Footnotes and Sources

1. ^{The Wall Street Journal, November 1, 2024}
2. ^{Investing.com, November 1, 2024}
3. ^{CNBC.com, October 30, 2024}
4. ^{The Wall Street Journal, October 30, 2024}
5. ^{The Wall Street Journal, November 1, 2024}
6. ^{The Wall Street Journal, November 1, 2024}

Stocks were mixed last week as fresh economic data points and election-related uncertainty slowed market momentum.

The Standard & Poor’s 500 Index fell 0.96 percent, while the Nasdaq Composite Index rose 0.16 percent. The Dow Jones Industrial Average dropped 2.68 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, slid 2.30 percent.^1,2

Nasdaq Leads

Stocks were mixed for the first half of the week as investors geared up for a steady stream of Q3 reports. The 10-year Treasury yield continued to trend higher, which caught the attention of some traders.

Markets fell Wednesday morning with news that existing home sales fell to a 14-year low in October; still slowed by higher interest rates, sales are on track for their worst year since 1995. Also, pre-election jitters remained an undertow with traders.^3,4,5

News that durable goods orders rose in September buoyed sentiment a bit. At Friday’s close, the Nasdaq, fueled by technology names, marked its seventh consecutive week of gains but the S&P 500 broke its 6-week winning streak.^6,7

Footnotes and Sources

1. ^{The Wall Street Journal, October 25, 2024}
2. ^{Investing.com, October 25, 2024}
3. ^{MarketWatch.com, October 23, 2024}
4. ^{The Wall Street Journal, October 23, 2024}
5. ^{The Wall Street Journal, October 23, 2024}
6. ^{ABA Banking Journal, October 25, 2024}
7. ^{CNBC.com, October 25, 2024}

Stocks posted modest gains last week, with quarterly earnings season in full swing and the election on the horizon.

The Standard & Poor’s 500 Index increased 0.85 percent, while the Nasdaq Composite Index rose 0.80 percent. The Dow Jones Industrial Average advanced 0.96 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, fell 0.31 percent.^1,2

Six in a Row

Stocks bolted out of the gate as the week began. The S&P 500 and the Dow Industrials hit record highs, with the Dow crossing 43,000 for the first time.³

Midweek, news of stronger-than-expected retail sales report contributed to overall market momentum. Retail sales rose a seasonally adjusted 0.4 percent in September, topping economists forecasts.⁴

As the week wrapped up, the technology sector helped fuel a rally that pushed the S&P and Nasdaq to another record high. It was the sixth straight week of gains for the S&P 500, Nasdaq, and Dow Industrials.⁵

Insight from Corporate Reports

There were many market forces pushing each other around last week.

Corporate earnings reports drove much of the market action. Some of the most extensive financial stocks surprised on the upside, supporting a narrative that the economy remains strong.

At the same time, a corporate report from one of the world’s largest chip manufacturing contractors revealed continued strong global demand for AI microchips. However, increasing investor anxiety was a constant undertow in trading as the November elections drew nearer.⁶

Footnotes and Sources

1. ^{The Wall Street Journal, October 18, 2024}
2. ^{Investing.com, October 18, 2024}
3. ^{CNBC.com, October 15, 2024}
4. ^{The Wall Street Journal, October 17, 2024}
5. ^{The Wall Street Journal, October 18, 2024}
6. ^{The Wall Street Journal, October 18, 2024}

Stocks advanced last week despite mixed inflation data, lurching oil prices, and lingering anxiety about the Middle East.

The Standard & Poor’s 500 Index gained 1.11 percent, while the Nasdaq Composite rose 1.13 percent. The Dow Jones Industrial Average picked up 1.21 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, added 0.23 percent.^1,2

Up And Down Week

Stocks slipped on Monday as oil continued to rise but moved higher on Tuesday as the technology sector showed the way. Oil prices fell back as investors took a wait-and-see stance concerning Middle East tensions.³

The S&P 500 and Dow Industrials hit fresh record highs on Wednesday but dipped Thursday morning after the latest Consumer Price Index (CPI) data showed inflation was warmer than expected.^4,5

Earnings season kicked off Friday, and update reports from a few money center banks injected some enthusiasm into markets. Also, the Producer Price Index (PPI) report showed wholesale prices stayed flat last month, a welcomed update for investors. All three averages closed higher for the fifth consecutive week.⁶

Inflation Moves Markets

Despite news that showed retail inflation continued to decelerate in September, anxious investors focused on the fact that CPI came in slightly warmer than economists expected for September. Meanwhile, Friday’s PPI reading came in slightly better than economists expected, adding a layer of complexity for the Fed as it evaluates the inflation story.^7,8

Footnotes and Sources

1. ^{The Wall Street Journal, October 11, 2024}
2. ^{Investing.com, October 11, 2024}
3. ^{CNBC.com, October 8, 2024}
4. ^{MarketWatch.com, October 9, 2024}
5. ^{The Wall Street Journal, October 10, 2024}
6. ^{The Wall Street Journal, October 10, 2024}
7. ^{The Wall Street Journal, October 11, 2024}
8. ^{MarketWatch.com, October 11, 2024}

Stocks were essentially unchanged last week as geopolitical tensions added some volatility to an otherwise quiet trading week.

The Dow Jones Industrial Average was flat (+0.09 percent), while the Standard & Poor’s 500 Index ticked up 0.22 percent. The Nasdaq Composite also was flat (+0.10 percent). The MSCI EAFE Index, which tracks developed overseas stock markets, was a bit more unsettled by the geopolitical events, dropping 3.74 percent.^1,2

Stocks Flat, Oil Spikes

Stocks posted modest gains on Monday, encouraged by upbeat comments in a speech by Fed Chair Jerome Powell. However, the modest gains pushed the S&P 500 and Dow to fresh records.³

As Middle East tensions escalated on the first day of October, stocks fell, bond yields rose, and oil prices rose as the news unfolded.⁴

On Wednesday, all three averages were flat. An ADP report showed higher-than-expected private sector job growth—a metric investors focus on. Oil prices continued to rise as investors watched the developments in the Middle East.^5,6

Then, on Friday, stocks rallied after the Labor Department’s September jobs report topped expectations.⁷

Jobs Out Front

The Labor Department’s jobs report gave investors some much-welcomed insights into the jobs market. At its September meeting, the Fed indicated it was watching the jobs market as closely as inflation, so updates on the jobs market are now considered as important as inflation reports.⁸

The report showed employers added 254,000 jobs, about 100,000 more than economists expected. It also showed that unemployment ticked down to 4.1 percent last month.⁹

Footnotes and Sources

1. ^{The Wall Street Journal, October 4, 2024}
2. ^{Investing.com, October 4, 2024}
3. ^{CNBC.com, September 30, 2024}
4. ^{The Wall Street Journal, October 1, 2024}
5. ^{The Wall Street Journal, October 2, 2024}
6. ^{The Financial Times, October 3, 2024}
7. ^{The Wall Street Journal, October 4, 2024}
8. ^{The Wall Street Journal, October 2, 2024}
9. ^{The Wall Street Journal, October 4, 2024}

Stocks moved higher last week, continuing to build on the momentum generated after the Federal Reserve decided to cut short-term rates by 0.50 percent.

The Standard & Poor’s 500 Index gained 0.59 percent, while the Nasdaq Composite rose 0.95 percent. The Dow Jones Industrial Average added 0.62 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, gained an eye-catching 3.53 percent.^1,2

Congress Passes Spending Bill

Stocks started the week tepidly but in the green, as investors mostly shrugged off Tuesday’s weak consumer confidence report. Then, at midweek, markets put on the brakes as investors appeared to take profits after a four-day winning streak.^3,4

On Thursday, markets rallied on news that the final Q2 gross domestic product estimate showed the economy increased at an annual rate of 3.0 percent. Then Friday, the PCE, or Personal Consumption and Expenditures Index, showed inflation had cooled slightly more than expected in August, which some believe may influence the Fed’s decisions on short-term rates at its November meeting.⁵

Finally, a continuing resolution was passed by both houses of Congress last week and signed by President Biden Friday morning, assuaging concerns over a government shutdown. The resolution funds the government until December 20.⁶

China’s Stimulus Package

This week, the head-turning performance came from outside the U.S.

As measured by the MSCI EAFE (Europe, Australia, and Far East) Index, international stocks rose more than 3 percent following news of China’s stimulus package, which could be as much as 2 trillion yuan, or $284 billion. China’s program also cut banks’ reserve requirements and lowered a key short-term interest rate.

While the EAFE Index doesn’t track stocks from Mainland China, the stimulus package had far-reaching implications for other countries.^7,8

Footnotes and Sources

1. ^{The Wall Street Journal, September 27, 2024}
2. ^{Investing.com, September 27, 2024}
3. ^{CNBC.com, September 24, 2024}
4. ^{CNBC.com, September 25, 2024}
5. ^{BEA.gov, September 26, 2024}
6. ^{The Wall Street Journal, September 22, 2024 OR
   The Hill, September 25, 2024}
7. ^{The Wall Street Journal, September 27, 2024}
8. ^{The Wall Street Journal, September 27, 2023}

Stocks moved higher last week after the Federal Reserve’s half-point rate cut, bolstered by multiple data points supporting a cooling but still strong economy and decelerating inflation.

The Standard & Poor’s 500 Index gained 1.36 percent, while the Nasdaq Composite rose 1.49 percent. The Dow Jones Industrial Average moved ahead by 1.62 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, inched up 0.42 percent.^1,2

Fed Cuts Rate 0.5 Percent

Stocks traded in a narrow range for the first half of the week as anxious investors awaited the outcome of the Federal Open Market Committee’s (FOMC) September meeting.^3,4

Shortly after 2 pm ET Wednesday, the Fed announced it was cutting rates by a half percentage point—a more significant cut than some investors anticipated. Stocks initially rose in response and then fell. Some market watchers attributed the decline to concern that the Fed might be concerned about economic growth.^5,6 

But after sleeping on it, stocks rallied Thursday, with the Nasdaq, S&P, and Dow climbing 2.5 percent, 1.7 percent, and 1.3 percent, respectively. The Dow topped 42,000 for the first time, while the S&P crossed the 5,700 mark.^7,8

Fed’s Move

The half-point cut was the first change in the Fed Funds Rate in 14 months and the first reduction in 4½ years, bringing its target range to 4.75-5.0 percent. Fed Chair Powell said the decision reflected the Committee’s “greater confidence that inflation is moving sustainably toward 2 percent” and that the “risks to achieving its employment and inflation goals are roughly in balance.”⁹

Footnotes and Sources

1. ^{The Wall Street Journal, September 20, 2024}
2. ^{Investing.com, September 20, 2024}
3. ^{CNBC.com, September 16, 2024}
4. ^{The Wall Street Journal, September 18, 2024}
5. ^{CNBC.com, September 18, 2024}
6. ^{The Wall Street Journal, September 18, 2024}
7. ^{The Wall Street Journal, September 19, 2024}
8. ^{The Wall Street Journal, September 20, 2024}
9. ^{The Wall Street Journal, September 18, 2024}

Stocks rallied last week as investors received better-than-expected consumer and producer inflation data.

The Dow Jones Industrial Average rose 2.60 percent, while the Standard & Poor’s 500 Index gained 4.02 percent. The Nasdaq Composite led, picking up 5.95 percent as tech stocks rebounded. The MSCI EAFE Index, which tracks developed overseas stock markets, rose 1.01 percent.^1,2

A Wednesday to Remember

Stocks bounced out of the gate at the start of the week as “risk on” investors made moves before the pending release of the twin inflation reports–the Consumer Price Index (CPI) and Producer Price Index (PPI). The three major averages added slightly more than 1 percent in Monday trading.³

On Wednesday, stocks initially dipped following the release of the CPI as traders appeared disappointed by the report. By midday, sentiment changed. The S&P 500, down as much as 1.6 percent in early trading, gained 1.1 percent by the closing bell. More inflation data out Thursday showed wholesale price increases were tempered, which helped stocks move higher through the balance of the week.^4,5

Small Caps Shine

Small-cap stocks, as measured by the Russell 2000 Index, have pushed higher in recent weeks, which is a telling move for some Wall Street observers. The Russell 2000 has outperformed the S&P 500 by more than 4 percent during Q3 so far.⁶

One reason is that smaller stocks tend to respond when they anticipate interest rates will trend lower. Investors appear to be positioning themselves in small cap issues, expecting the Fed may adjust rates at its September meeting as it looks to guide the economy to a soft landing.⁷

Footnotes and Sources

1. ^{The Wall Street Journal, September 13, 2024}
2. ^{Investing.com, September 13, 2024}
3. ^{The Wall Street Journal, September 10, 2024}
4. ^{The Wall Street Journal, September 11, 2024}
5. ^{CNBC.com, September 12, 2024}
6. ^{The Wall Street Journal, September 13, 2024}
7. ^{MarketWatch.com, September 12, 2024}

Stocks fell last week as soft economic data rattled investors focused on the Fed’s next move with interest rates.

The Dow Jones Industrial Average lost 2.93 percent, while the Standard & Poor’s 500 Index dropped 4.25 percent. The tech-heavy Nasdaq Composite fell 5.77 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, declined 2.91 percent.^1,2

Economic Data Unsettles Investors

The four-day trading week got off to a rough start as weak manufacturing data reawakened recessionary fears. All three major averages were down for the first session after the Labor Day holiday. For many, it was reminiscent of August 5, when stocks tumbled as recession worries unsettled investors.³

Attention shifted to Friday’s jobs report as stocks traded narrowly. Markets initially reacted positively to news that job growth rebounded slightly and unemployment ticked down. However, selling pressure increased as the trading session progressed and investors digested the underlying data. The S&P 500 had its worst week since March 2023.⁴

Focus on Fed’s September Meeting

The Federal Reserve seems poised to make a tough decision regarding monetary policy in its September meeting. The jobs market and other softening economic data have quickly overshadowed concerns about inflation.

However, there’s still a case to be made for a soft landing.

Job growth in August was slower than expected, but 142,000 jobs were created–an uptick that some would argue is an overall positive despite missing expectations. The drop in the unemployment rate to 4.2 percent bolstered the soft-landing narrative.⁵

Market observers anticipate a 0.25 percent rate adjustment in September, but some contend that the Fed may consider a more significant move. On Friday, Fed Governor Christopher Waller said he was open to a larger move if necessary. Chicago Fed President Austan Goolsbee and New York Fed President John Williams commented similarly during the week.^6,7

Footnotes and Sources

 

1. ^{The Wall Street Journal, September 6, 2024}
2. ^{Investing.com, August 30, 2024}
3. ^{The Wall Street Journal, September 3, 2024}
4. ^{The Wall Street Journal, September 6, 2024}
5. ^{The Wall Street Journal, September 6, 2024}
6. ^{Marketwatch.com, September 5, 2024}
7. ^{CNBC.com, September 6, 2024} 

There were mixed results for stocks last week as upbeat economic data and a critical Q2 corporate report shaped the week.

The Dow Jones Industrial Average rose 0.94 percent, while the Standard & Poor’s 500 Index increased 0.24 percent. The Nasdaq Composite lagged, falling 0.92 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, gained 0.35 percent.^1,2

Key Economic Data

Markets began the week quiet as investors awaited Q2 earnings from Nvidia, the world’s most influential name in artificial intelligence.

The chipmaker–the second largest stock in the S&P 500 by market capitalization–dipped on the news, putting pressure on the Nasdaq and S&P 500. (The Nasdaq and S&P 500 are market-weighted averages, so larger companies have an outsized impact.)³

Nvidia is mentioned to show its influence on the overall stock market. It should not be considered a solicitation for the purchase or sale of the company.

On Thursday, an upward revision in Gross Domestic Product (GDP) data boosted markets, although stocks fell later in the day. Friday’s Personal Consumption and Expenditures (PCE) data seemed to confirm that inflation remained tame, welcome news for investors who are anticipating the Fed may adjust rates in September.⁴

Softer Landing in Focus?

Several pieces of data helped build a narrative that the economy may be coming in for a soft landing.

Second-quarter GDP growth was revised upward, from 2.8 percent to 3.0 percent. That’s an improvement from Q1 GDP, which rose 1.4 percent. Some market watchers were concerned about the Q2 revision after pending home sales in July hit its lowest monthly level in 23 years.⁵

Meanwhile, the Federal Reserve’s preferred measure of inflation, the PCE Index, came in 0.2 percent higher in July–in line with expectations. Core PCE inflation, which the Fed tracks closely, edged up 0.2 percent–also in line with forecasts.⁶

Footnotes and Sources

1. ^{The Wall Street Journal, August 30, 2024}
2. ^{Investing.com, August 30, 2024}
3. ^{CNBC.com, August 28, 2024}
4. ^{The Wall Street Journal, August 30, 2024}
5. ^{The Wall Street Journal, August 29, 2024}
6. ^{CNBC.com, August 30, 2024}