Stocks Boom While Joie de Vivre Rides the Wave
Last week, U.S. markets threw on a bright‑coat of optimism and swung higher, rescuing a number of big names from a short‑term slide. It was a win‑for‑all, where every major index—or at least most of them—climbed back, giving investors a quick confidence boost.
What Made It Tick?
- Broad‑Based Gains: The rally wasn’t just one sector. It spilled across the board, showing the market’s hidden resilience even while uncertainty loomed about the new Trump administration and the tension simmering in the Russia‑Ukraine war.
- Smaller‑Cap Starters: Investors seemed to trust the “long‑shot” smaller companies more than the big names, hinting at hope that growth will spread wide and deep.
- Equal‑Weighted Edge: The equal‑weighted S&P 500 edged out its usual cap‑weighted counterpart, proving that strengths cropped up across the broader market, not just the high‑high‑high performers.
- Bitcoin kept thumping, riding its third straight week of double‑digit gains after the election.
NVIDIA’s Earnings: A Heads‑Up
In a calendar that stayed on the lighter side, NVIDIA’s quarter ended up being the talk of the town. The chipmaker delivered what analysts expected, but its cautious outlook for next quarter dampened all‑the‑thrill excitement. The result? The stock stayed almost still.
Utilities Get a Boost (and Tech Gets a Nudge)
While the tech‑heavy communication sector fell into a slump—thanks to a dip in Alphabet shares after the Justice Department hinted at a breakup of the search giant—the utilities industry shot up. Their positivity stemmed largely from NVIDIA’s optimistic view on AI and clean energy demands.
Job Market Smiles
- New jobless claims fell to 213,000, the lowest since April 2024—an unexpected win that underlines a sturdy job market.
- Meanwhile, continuing claims reached a three‑year high of 1.91 million, but that’s mainly owing to the resolved Boeing machinist strike.
- Housing looks better too: the National Association of Realtors recorded a year‑on‑year jump in existing home sales for October—the first uptick since July 2021.
- With mortgage rates stabilising, job growth, and steady macro‑conditions, investors feel the market’s heartbeat is steady again.
Feds and Bonds: A Mix of Hope and Caution
Market dwellers keep an eye on the Fed’s final meeting of the year in December. Governor Lisa Cook signalled that next-cut plans will be gradual and data‑driven. At the same time, bonds prove tricky: U.S. Treasuries gained, short‑term yields rose while long‑term ones fell. Municipal bonds saw big thirst — some new issues were oversubscribed by up to 20 times. Corporate and high‑yield bonds found new confidence after a dip in economic worries and the tech rally. Not all was smooth; Spirit Airlines filed for bankruptcy, proving the travel sector still has quivers.
Europe: Mixed Feelings, Hopeful Eyes
The pan‑European STOXX 600 Index edged up by 1.06%, thanks to hopes that the ECB could cut borrowing costs in December after poor PMI data. In the U.K., inflation nudged higher—2.3% in October—pushing toward less optimism for a rate cut in 2025. Bank of England workers had a front‑row view on the inflation struggle.
Japan’s Calm, Yet Cautious Shuffle
The Nikkei 225 dipped, while the broader TOPIX declined a touch. Rising rate worries and tensions made risk appetite lower, and investors leaned into safe‑haven Japanese yen. Consumer inflation out‑paced the Bank of Japan’s 2% goal, justifying a hawkish stance. The 10‑year JGB yield approached a 13‑year high. The government rattled off a 250 billion‑dollar package to cool heat, but it’s unclear how wholly it will help.
China: Downturn, Distrust, and Hesitant Patience
Shanghai Composite slid 1.91%, CSI 300 fell 2.6%. Weak data, policy uncertainties, and a dampening of risk appetite kept markets down. Even though the government launched a RMB 10 trillion debt swap and other stimulus tricks, the housing and consumer sectors remain bruised. Banks kept lending rates steady, and youth unemployment saw small improvement, yet uncertainty still hangs like shade over China’s economy.
Bottom Line: A Global Tapestry of Flavors
Last week was a global musical mix: U.S. stocks bounced hard thanks to job and housing buoyancy. Europe and Asia kept dealing with economic caution and geopolitical flares. Key themes spun around rate‑cut expectations in U.S. and Europe, Japan’s tightening in response to inflation, and China’s ongoing battle with sluggish housing and consumer demand.
