A Strong Economy is Making the Inflation Fight Difficult

The S&P 500® index was 1.1% higher last week while the NASDAQ Composite grew by 2.1%. The Dow Jones Industrial Average was up a modest 0.2% for the week, but it’s a slim 5.3% lower on the year. Through Friday, the S&P 500 is down 14.7% year-to-date and the NASDAQ Composite is lower by 26.7% on a price-only basis.

Consumers Show Resilience as the Holiday Shopping Season Kicks Into High Gear

Stocks notched a week of gains amid low trading volume, U.S. markets being closed on Thanksgiving, and a shortened trading session on Friday. The S&P 500 rose +1.5% last week, while the NASDAQ Composite eked out a gain of +0.7%. The Dow Jones Industrials Average added +1.8% on the week.

Economic Weakness and Inflation Loom Large as the Holiday Season Approaches

U.S. stocks finished last week modestly lower, with the S&P 500 Index and NASDAQ Composite both giving back some of their big gains in the prior week and after posting their best weekly performance since June. The S&P 500 closed the week lower by 0.7%, with the NASDAQ losing 1.6% and the Dow Jones Industrials Average finishing the week flat.

Investors Cheer Lower Inflation Data, But One Month Doesn’t Make a Trend

U.S. equity markets roared higher last week following an October Consumer Price Index (CPI) print that came in weaker than expected. The likelihood of a divided government over the next two years also helped propel stock prices higher. Last week, equities essentially erased their prior week’s declines, as the S&P 500 Index advanced +5.9% and the NASDAQ Composite soared +8.1%. The Dow Jones Industrials Average and Russell 2000 Index also experienced strong gains on the week, rising +4.2% and +4.6%, respectively. Notably, the S&P 500 Index moved back above its 50-day and 100-day moving averages and even peaked above the 4,000 level at one point on Friday before settling at 3,993 — its highest level since mid-September.