U.S. Averages Hover Near Record Highs, Crude Oil Rebounds to 2-week High

Barry Adams
20 Dec, 2023
New York City

Stocks struggled in early trading, and market indexes turned lower after policymakers continued to push back on the rate-cut narrative dominating the market.

The S&P 500 index and the Nasdaq Composite decreased as much as 0.2% after advancing on Tuesday.

The Nasdaq Composite advanced 0.7% and traded above the 15,000 mark for the first time since January 2022 after the market rally pushed the index higher in the previous seven consecutive weeks.

The S&P 500 index gained 0.6% and approached its record high in January 2022.

Both benchmark indexes have rallied for seven weeks in a row and advanced 4% in December after investors expanded bets on the Federal Reserve's cutting rates in 2024.

Market sentiment was also bolstered in the last two months after several indicators confirmed the easing of inflation and the Federal Reserve held the fed funds rate for the third time in a row at the end of its final meeting on December 12–13.

For the year so far, the S&P 500 index is at 24%, and the Nasdaq Composite gained 43.4%.

 

U.S. Indexes and Yields

The S&P 500 index gained 0.4% to 4,758.54, and the Nasdaq Composite increased 0.4% to 14,961.41.

The yield on 2-year Treasury notes increased to 4.38%, 10-year Treasury notes inched lower to 3.88%, and 30-year Treasury bonds eased to 4.0%.

Crude oil increased $0.90 to $74.85 a barrel, and natural gas prices decreased 2 cents to $2.51 a thermal unit.

Gold decreased $7.33 to $2,033.12 an ounce and halted a four-day rally following the Fed's rate decision and announcement to cut rates several times over the next two years.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 102.33 and extended the previous week's loss of 1.4% and the loss of 0.9% in the year so far.

 

U.S. Stock Movers

FedEx dropped 11.1% to $248.85 after the parcel delivery company reported mixed quarterly results and an estimated annual revenue outlook that fell short of investors' expectations.

Tesla decreased 0.2% to $256.68 after the company sharply lowered prices on luxury sedan vehicles in China to match lower prices from market leader BYD.

General Mills declined 4% to $64.0 after the food products maker reported quarterly earnings were ahead of expectations but revenue fell short of estimates, and the company lowered its annual outlook.

Winnebago Industries decreased 4.5% to $71.80 after the company issued a cautious outlook, citing macroeconomic headwinds.

Toro Company jumped 9.7% to $97.83 after the lawn mover maker reported better-than-expected quarterly results.