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Stock market news today: Stocks surge as inflation soars

Inventory of unsold resale homes dropped 11.5% to 1 million between November and December, leaving existing home stock at a scant 3.2-month supply at the current sales pace. Many experts say a balanced housing market has a four- to six-month supply. The S&P 500 index closed at a record on Friday, crossing above its old high-water mark, set in early 2022. The gains show that investors have overcome fears of rising interest rates and panic about a recession that had governed stock trading for much of the past two years. It’s about to be a huge week for the stock market as investors confront a wave of economic data and decide whether the ongoing rally to record highs has staying power or not. General Mills — Shares of the food products company fell 3% after General Mills reported revenue for its fiscal second quarter that was light of expectations and said organic net set sales were down 2% year over despite stronger pricing.

Winnebago — Shares of the motorhome manufacturer stock fell 1.7% after Winnebago missed earnings expectations for the fiscal first quarter. The company reported $1.06 in adjusted earnings per share, while analysts surveyed by StreetAccount expected $1.18 per share. “We continue to see a tale of two economies in the data,” said Sam Khater, Freddie Mac’s chief economist. “Strong job and wage growth are keeping consumers’ balance sheets positive, while lingering inflation, recession fears and housing affordability are driving housing demand down precipitously.” Already, the Fed has raised rates by a historic half point and then twice by three quarters of a point.

  1. The pullback comes after a robust session Tuesday when the Dow and the Nasdaq Composite both registered nine straight days of gains.
  2. Wall Street’s mood has largely tracked the rapidly changing expectations regarding inflation and rate hikes.
  3. Sales of newly constructed single-family homes were up 8% in December from the month before and 4.4% annually, according to the latest U.S.
  4. The FOMC also projects a 2024 U.S. unemployment rate of 4.1%, up from the 3.7% rate the Labor Department reported in November.
  5. The company’s dominance in the China’s e-commerce market, retail strength, and solid growth opportunities in international market are positives.

“Now, it probably won’t derail the year-end melt-up, but given the multitude of overbought conditions and stretched indicators, a market pricing in perfection just got a bit of troubling news.” Salil Mehta, a statistician and a former director of analytics for the U.S. But it is an average decline, believe it or not, it is,” he told MarketWatch over the weekend. U.S. government-debt yields finished mixed on Tuesday as traders assessed improving consumer-confidence figures and looked ahead to Wednesday’s interest-rate policy announcement by the Federal Reserve.

Investors concerned about recession risk in 2024 can take advantage of rising interest rates by reducing exposure to stocks and increasing their cash holdings. Investors can even move to lock in yields of up to 5.6% on certificates of deposit that are insured by the Federal Deposit Insurance Corporation before the Fed starts cutting interest rates. Rising interest rates increase borrowing costs for both U.S. consumers and corporations, pressuring investment and economic growth. Inflation has also increased input costs for U.S. companies, squeezing profit margins and weighing on earnings. Meanwhile, mortgage rate optimism shot up in the latest Fannie Mae Home Purchase Sentiment Index (HPSI) in which a survey-high 31% of consumers said they expect mortgage rates to decline further. However, Yun noted that a meaningful increase in resale inventory will be pivotal to support the bump in demand that experts anticipate declining mortgage rates will stimulate.

As you can see, gold outdid almost all major stock indexes, except for the U.K.’s FTSE 100, which has increased 0.75% between January and April. A table comparing the performance of the gold price traderoom with the major U.S. and European stock indexes between January and April 2022. Historically, the price of gold tends to fall when the dollar’s value increases relative to other currencies.

Increasingly, Google searches have been focused on the state of the market (and the economy), and for a good reason. You can see the full Zacks #1 Rank List or narrow it down to Zacks #1 Rank Stocks with a Value, Growth, Momentum or Income Style Score of A or B. You can also sort the list with criteria you choose, view Additions and Deletions by day, and Performance.

What will happen if the housing market crashes?

Prices increased once again in December, according to the NAR, which reports that median existing-home prices were up 4.4% over last year – the sixth month in a row of year-over-year jumps. In another reflection of ongoing increases, the latest S&P CoreLogic Case-Shiller home price index showed a 4.8% jump in October that represented the ninth month in a row of gains. The frenzy kicks off on Tuesday with the earnings results from mega-cap tech companies Microsoft and Alphabet. Investors will be keenly focused on commentary related to artificial intelligence, of which both companies are at the forefront of, and how it will impact their business in 2024 and beyond. The Information reported Tuesday that the company is planning to restructure its advertising sales team.

Dow Jones Network

Stocks were soaring in midday trading Thursday, despite the fact that the consumer price index rose more than expected. All 30 Dow stocks were higher, with the energy and financial sectors posting the biggest gains. Investor concerns over rising interest rates, slowing economic growth and high inflation subsided in 2023, and investor enthusiasm for artificial intelligence https://traderoom.info/ technology fueled one of the Nasdaq Composite’s best annual total returns since 2009. Technology stocks, growth stocks and cryptocurrencies were top performers in 2023 as appetite for risk assets returned to the market. Inflationary pressures led central banks around the world, including the US Federal Reserve, to raise interest rates in an effort to cool demand.

There is no governing body that says what it is, or decides when it started (as there is with a recession). But on Wall Street, there are two common ways the label gets applied. Instead, they’re now betting that a drop in rates will help expand corporate profits, while the economy stays on a relatively solid footing. It doesn’t mean stocks will continue to rise indefinitely, but it does reflect a generally optimistic outlook on Wall Street.

February 2024 Stock Market Forecast

According to Realtor.com’s December 2023 Housing Market Trends Report, high mortgage rates have increased the monthly cost of financing the typical home (after a 20% down payment) by 6.1% since last year. That equates to $123 more in monthly payments than a buyer last December would have seen. Much to the chagrin of would-be homebuyers, property prices just keep rising. It seems nothing – not even the highest mortgage rates in nearly 23 years – can stop the continued climb of home prices. The week will be capped off by an economic data dump on Friday with the release of the January jobs report and an update to the unemployment rate. By the end of next week, more than $10 trillion in S&P 500 market value will have reported earnings results, giving investors a good sense of the current state of corporate profit growth.

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This was one of the reasons why the gold price slipped to a more than two-month low at the end of April. In March, gold climbed further to $2,043 per ounce, close to its all-time high, showing a rise of 13.5% from the start of the year. Days before Russia’s invasion of Ukraine, the spot gold price hit $1,912 per ounce, rising from its $1,800 range of the beginning of February. Moreover, the ongoing war in Ukraine has lowered investors’ risk appetite, leading to many people selling riskier investments and turning to safe-haven assets like gold and precious metals.

The index gained more than 4% on the month and closed out the year up better than 26% based on total return and on the brink of new all-time highs. The S&P 500 fell 3% and the Nasdaq was down 3.9%, wiping out last week’s gains. Investors are concerned that the Federal Reserve’s response to Tuesday’s report could hurt the US economy — possibly sending it into a recession. Gold and silver seem to be trapped in a prolonged consolidation after such strong gains in 2020.

Stocks come back from lows

Fertilizer stocks CF Industries (CF) and Mosaic (MOS) and chemicals company Albemarle (ALB) were higher too. As stocks settle after the trading day, levels might still change slightly. CPM Group’s Christian said his firm sees the potential for gold to take another run at its record high next year, and he pointed to many “substantive real reasons” for investors to get excited about gold and where it’s going.

Even with the recent decline, rates are still much higher than they were at the start of the Covid pandemic. Interest rates need to fall much further to encourage housing sales and refinancings, and that’s unlikely unless unemployment rises, the firm said. He said the next several months will undoubtedly be important for the economy and the housing market. Barclays predicts that the central bank will lower rates by a quarter of a point at each of its last three meetings in 2023.

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