U.S. Stock Action: The Nasdaq Took a Dream‑High, But Most Others Took a Drip
Over the past week, the big American dowsings went on a roller‑coaster ride. While the Dow Jones and the SP 500 danced downwards, the Nasdaq Composite strutted past 20,000 for the first time—talk about an internet‑age triumph!
Big‑Name Survivors vs. Small‑Time Starters
- Large‑cap stocks stayed stronger than small‑cap beasts. The Russell 2000 still lagged behind the S&P 500, proving that size does matter.
Growth Wins, Value Stands Down
- Growth stocks kept their winning streak for the third week straight. Tesla jumped +12.08% and Alphabet +8.44%, putting the “drive” on “grow.”
Momentum: A Tango of Ups and Downs
Monday saw the largest slump in momentum‑driven stocks in more than a year, but investors steadied the ship as the week progressed. The market’s nerves stayed charged as trading volume hovered above the six‑month average.
Sector Snapshot
- Communication services and consumer discretionary stole the spotlight with modest gains.
- Most other sectors appeared to be in a brief low‑energy slump.
Inflation & Labor: The Economic Pulse
Headline & core CPI both ticked up 0.3% in November. On an annual basis, core inflation stayed at 3.3% while overall inflation nudged from 2.6% in October to 2.7%—thanks, shelter cost surge. Producer price inflation also crept up from 0.3% to 0.4%.
Jobless claims hit a two‑month high of 242,000. Thanksgiving’s seasonal shift contributed, but the rising continuing claims flag a tougher job hunt.
Fed Hopes & Treasury Surge
- Expectations for a rate cut at the next Fed meeting ballooned to 97.1% confidence, up from 86% a week earlier.
- U.S. Treasury yields climbed, sending both Treasuries and investment‑grade corporate bonds into negative territory. High‑yield bonds saw a trading spike post‑CPI release.
Europe’s Roller‑Coaster
Europe’s STOXX 600 dipped 0.77%. Germany’s DAX barely moved, while Italy’s FTSE MIB climbed 0.40%. France’s CAC 40 and the UK’s FTSE 100 fared modestly, both dipping slightly.
ECB & Swiss Bank Moves
- The ECB trimmed its key deposit rate by 0.25% to 3.0%, dropping the “sufficiently restrictive” stance and tightening the policy language.
- Switzerland’s central bank slashed rates by a hefty 0.50%, its most dramatic drop since 2015, flattening the 2025 inflation forecast from 0.6% to 0.3%.
UK & France: GDP Tumble & Political Shake‑Ups
- UK GDP slipped 0.1% in October, but the three‑month growth remained +0.1% thanks to construction & services.
- Macron appointed former Justice Minister François Bayrou as prime minister, replacing Michel Barnier—an upheaval that may reshape France’s economic path.
Japan & China: Asian Pivot
Japan’s Nikkei rapped up 0.97% and TOPIX climbed 0.71%. China’s policy announcements weren’t hot enough; inflation slowed, with the CPI up only 0.2% y/y and core up 0.3%.
- Tokyo’s investors felt buoyed by China’s fiscal boost and a swipe of monetary easing.
- The BoJ may delay a rate hike to January 2025, banking on extra data and quarterly reports. This has put the yen slightly weaker—now in the 153‑JPY zone.
- Japan’s Q3 GDP rose 0.3% q/q, outpacing the 0.2% consensus estimate. Large manufacturers’ sentiment improved.
Global Takeaway
In a nutshell, the U.S. market split its legs with the Nasdaq surfing a wave to 20,000 while other indices sank footfalls. Europe reacted to rate cuts, while Asian voices shouted optimism in Japan but sighed in China. Investors should lean on these mixed signals and adjust their risk‑taking accordingly.
