U.S. Stocks Lacked Direction and Indexes Paused After 4-week Rally

Barry Adams
27 Nov, 2023
New York City

Market indexes rested after advancing for four weeks in a row, and investors refrained from adding more exposure to risky assets.

The S&P 500 and the Nasdaq Composite hovered at a flat line, and investors debated rate paths, economic growth outlooks, and market valuations.

Market sentiment has been positive after the Federal Reserve held the fed funds rate for the second time in a row, and investors stepped up their bets that the central bank is done raising rates for now.

Moreover, three key measures of inflation—consumer price inflation, producer price inflation, and import price inflation—have been on a steady decline for several months.

Investors also bid up stocks after the minutes of the Federal Open Market Committee in early November sent mixed signals about the health of the economy and the need for restrictive rates until more evidence emerges about the downward trend of inflation.

In November so far, the S&P500 index increased 8.6% and the Nasdaq Composite soared 11%.

Investors have been bidding up stocks despite leading retailers, including Walmart, Lowe's Companies, Target, and Best Buy, issuing a cautionary outlook for holiday sales last week.

New home sales data showed home sales declined 5.6% to an annual rate of 679,000 in October from a 719,000 rate in September, the U.S. Census Bureau reported Monday.

New home sales soared 17.7% from an estimate of 577,000 a year ago.

The median price of new homes sold was $409,300, while the average sales price was $487,000, compared to $496,800 and $543,300, respectively, a year ago.

 

U.S. Indexes and Yields

The S&P 500 index edged down 0.2% to 4,550.21, and the Nasdaq Composite decreased 0.1% to 14,235.71.

The yield on 2-year Treasury notes increased to 4.92%, 10-year Treasury notes inched higher to 4.43%, and 30-year Treasury bonds edged higher to 4.57%.

Crude oil decreased $0.42 to $75.10 a barrel, and natural gas prices fell 8 cents to $2.77 a thermal unit.

Gold increased $6.55 to $2,008.72 an ounce after the U.S. dollar eased.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 103.40.