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The Stock Market Shines While Inflation Softens: A Weekly Roundup

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Stock markets basked in their third straight week of gains, propelled by inflation data that fell short of expectations. The Fed futures market is predicting a sunny forecast with four rate cuts in 2024.

Small-cap stocks, as tracked by the iShares Russell 2000 ETF IWM, stood out as the top performers for the week, soaring by over 5%, while the dollar floundered, facing its weakest week since early July.

The S&P 500 Index, closely watched via the SPDR S&P 500 ETF Trust SPY, closed the week 2.2% higher at 4,513 points, hovering near a crucial technical level. Large-cap tech stocks, as monitored by the Invesco QQQ Trust QQQ, were up 2% for the week.

All eleven S&P 500 sectors boasted a positive weekly performance. Real EstateΒ Select Sector SPDR Fund XLRE and the MaterialsΒ Select Sector SPDR Fund XLB, were among the standout performers, up by 4.5% and 3.6% respectively.

Long-term Treasuries, as gauged by the popular iShares 20+ Year Treasury Bond ETF TLT, rose by 2.3% this week, marking their fourth consecutive week of positive performance as yields decline.

Bitcoin BTC/USD concluded the week with a 1.5% decline, breaking its four-week streak of gains.

Chart of the Week: S&P 500 Nears Critical Technical Level

US inflation eases more than expected in October: The U.S. inflation rate in October decelerated to 3.2% year-over-year, down from the 3.7% observed in September and below the expected 3.3%. The annual core inflation rate, which strips out volatile food and energy costs, ticked down from 4.1% to 4% year-over-year in October.

Producer prices deflate, retail sales contract: The Producer Price Index fell by 0.5% month-on-month, marking the first move toward deflation since May 2023, down from a revised 0.4% surge in September and below the expected 0.1% increase. Retail sales revealed a month-on-month contraction of 0.1%: a slowdown from the upwardly revised 0.9% increase in September, but slightly better than the expected 0.3% contraction.Β 

Five intriguing price shifts, a Thanksgiving cost conundrum and more: Delving into the inflation reports, Benzinga identified five significant price trends influencing both U.S. consumers and producers. Key observations include the sharp decline in gasoline prices, the popping of the egg price bubble, the continuous steep increase in orange juice prices, and the upward trend in service costs, notably for sporting events and motor insurance. Additionally, the cost of Thanksgiving turkeys presents an intriguing dynamic this season.

Walmart beats expectations, but stock plummets on cautious outlook: Walmart Inc. WMT reported third-quarter FY24 sales growth of 5.2% year-over-year to $160.8 billion, beating the consensus of $159.55 billion. Earnings per share came in at $1.53, marginally beating expectations of $1.522. Nevertheless, the retail giant’s shares plummeted over 8%, as the company also cautioned about a possible consumer spending slowdown and deflationary pressures on prices in the forthcoming months.Β 

Joe Biden calls Xi Jinping a β€˜dictator’ after crucial meeting: President Joe Biden once again called Chinese President Xi Jinping a β€œdictator” in the aftermath of the Asian Pacific Economic Cooperation summit in San Francisco. The summit, marking the first in-person meeting of the two world leaders in over a year, delved into intricate issues such as climate change, artificial intelligence, geopolitics, and global economic growth.Β 

Benzinga’s Fintech and Digital Assets Event in New York: Benzinga recently hosted a two-day live gathering in New York, with Unicoin as the main sponsor, spotlighting outstanding speakers in the realms of fintech and digital assets. The event’s agenda featured discussions on vital topics such as blockchain’s impact, the democratization of investing, the progress in crypto ETFs, and more.Β 

Does Thanksgiving Week Cook Up Stock Market Gains? On average, the S&P 500 gains about 0.6% during Thanksgiving week, outperforming other weeks of the year, yet analysts warn the effect is typically short-lived.Β 

What To Watch In The Week Ahead: The release of the minutes from the Federal Reserve’s Open Market Committee meeting in November, scheduled for Tuesday, stands as the week’s focal point. Investors will closely scrutinize these minutes for any broad consensus on the end of Fed rate hikes and insights into how policymakers view the economic outlook.

Upcoming Earnings To Watch: All eyes are on semiconductor stock Nvidia Corp. NVDA for its third-quarter earnings, set for release in the aftermarket session on Tuesday. The week will also see other major players sharing their financials, with Lowe’s Companies Inc. LOWE and Analog Devices Inc. ADI reporting on Tuesday, and Deere & Company DE on Wednesday.

Read now: Apple, Lions Gate Join IBM In Pushback Against Elon Musk, Twitter Over Antisemitic Content

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