The upcoming week will be the last one before the holiday season kickstarts after Fed pushed the global equity markets to the record highs. Analysts and experts expect that global economic data points should aid market movement in the coming week. Even though macro strategists expect that there will be the positive movement, certain economic data points will be worth watching. These data points include CB consumer sentiment for the month of December, final 3Q GDP data, and PCE data. Collectively, all these data points might result in a “soft landing.”
Wall Street analysts expect that US GDP will remain at ~5.2% at an annualized pace, and PCE should further cool down, reinforcing the apex bank’s decision to cut rates in the next year. PCE is seen as US Federal Reserve’s favourite indicator. The stocks ended on Friday mostly higher, with renowned US equity indexes seeing 7th straight week in green because of the Federal Reserve’s policy meeting.
Even though global economic data points should aid market movement, S&P 500 saw longest weekly winning momentum since month of November 2017, as per Dow Jones Market Data.
Dow Jones Industrial Average saw an increase of 56.81 points, or 0.2%, to end at ~37,305.16. S&P 500 remained about flat, slipping lower than 0.1%, to end at ~4,719.19. Nasdaq Composite saw an increase of 52.36 points, or 0.4%, to sit at ~14,813.92 levels. The US equities saw a significant rally in the week gone by as investors digested the US inflation and Federal Reserve’s current policy statement and projections on interest rates. All the frontline indexes i.e., The Dow, S&P 500 and Nasdaq Composite, all saw 7th straight week of gains.
Global experts believe that more optimistic tone of markets has been justified in the previous week and its “reasonable” for equity market to expect rate cuts by the US Fed in 2024. In addition to these indicators, the current drop in 10-year Treasury yields helped lift equities too.
Nearly all of S&P 500’s 11 sectors ended in gains in the previous week, with small-cap stocks seeing a stronger rally as compared to large-cap equities. Russell 2000 index saw weekly gain of ~5.6% as per the data from FactSet. In comparison, S&P 500 increased by just ~2.5%.
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