Traders work on the New York Stock Exchange floor on Nov. 12, 2024.
Source: NYSE
The S&P 500 inched higher Tuesday, eking out another record close.
The broad market index added 0.05%, ending at 6,049.88. The Nasdaq Composite advanced 0.40% to close at 19,480.91, hitting a new intraday high earlier in the session. Both the S&P 500 and the tech-heavy Nasdaq closed at records. The Dow Jones Industrial Average underperformed, losing 76.47 points, or 0.17%, to settle at 44,705.53.
“U.S. equities are trending sideways today in front of Friday’s job report, which may provide insight into what the Fed might do following its December 17 and 18 FOMC meeting,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. “On balance, we think there’s much to like about U.S. equities, despite a wall of worry that looms on the horizon.”
“Inflation, interest rates and earnings are supportive of a risk-on bias, and technological advances such as Gen AI continue to expand markets while pushing equities higher,” he added.
Stocks have been on a blistering rally since the U.S. presidential election. Since the Nov. 5 vote, the S&P 500 has climbed 4.6%, and the Nasdaq has rallied about 5.7%. The Dow is up 5.9% since then.
“When the market is up 10% or more with a newly elected President, it has never gone down in the month of December,” said Ken Mahoney, CEO of Mahoney Asset Management.
But he cautioned this doesn’t mean that stocks will soar in December, since November was the best month of the year for the market. During the last trading day of November, the Dow and the S&P reached new intraday and closing highs, leading both indexes to post their best months of 2024. The Dow added 7.5%, while the S&P 500 gained 5.7% last month.
“But there’s still enough demand for stocks, because I do think there’s a fair amount of money that’s coming up the sidelines post election,” Mahoney added.
Economic data released on Tuesday showed that job openings were higher in October compared to September. Job openings hit a total of 7.74 million last month, topping the Dow Jones estimate of 7.5 million.
This was the first in a salvo of data releases expected this week that can provide insight into the strength of the labor market. The main event will be Friday’s November payrolls report.
The data arrives ahead of the Federal Reserve’s policy meeting on Dec. 17-18. Fed funds futures are currently pricing in a roughly 72% probability that the central bank lowers interest rates during its gathering, according to CME’s FedWatch Tool.
