WEEKLY MARKET RECAP – NOVEMBER 29, 2024

The major U.S. stock indexes gained over 1% during a holiday-shortened trading week, building on the previous week’s upward momentum. Both the S&P 500 and the Dow reached new record highs, while the NASDAQ ended slightly below its peak set three weeks ago.

U.S. government bond yields dropped significantly on Monday following President-Elect Donald Trump’s announcement of Scott Bessent as his nominee for Treasury Secretary. The yield on the 10-year U.S. Treasury closed at approximately 4.17% on Friday, down from 4.42% the prior week and a recent high of 4.50% on November 15. Yields for both 2-year and 10-year notes declined as well.

U.S. stock markets rallied in November, marking gains for the sixth time in seven months and rebounding from a modest decline in October. The Dow rose 7.5%, the NASDAQ gained 6.2%, and the S&P 500 increased 5.7%.

On Monday, President-Elect Trump’s warning of potential tariffs on goods from China, Canada, and Mexico prompted retaliatory threats from those nations. The Canadian dollar and Mexican peso weakened significantly against the U.S. dollar, and stocks in the automotive sector saw declines.

Progress in reducing inflation appeared to stall, as shown in Wednesday’s release of the Federal Reserve’s preferred inflation measure. The Personal Consumption Expenditures (PCE) Index rose 2.3% annually in October, up from 2.1% in September. The core PCE Index, excluding food and energy, climbed to 2.8% from 2.7%.

Despite inflation remaining above the Fed’s 2% target, officials expressed optimism about easing price pressures and the strength of the labor market. These views were detailed in minutes from the November 6–7 Federal Reserve meeting, released on Wednesday. The Fed’s next meeting is scheduled for December 17–18.

Analysts predict robust earnings growth for the fourth quarter, expecting it to be the strongest in three years. According to FactSet, earnings for S&P 500 companies are projected to rise 12%—double the 5.8% growth rate recorded in the recently concluded third quarter.

A labor market report due Friday will indicate if the recent slowdown in U.S. job growth persisted into November. Following a strong September gain, October saw only 12,000 new jobs added—the smallest increase since December 2020. Additionally, job figures for August and September were revised downward, while the unemployment rate remained steady at 4.1%.