Stocks Mixed on Release of Old Economic Data; Bonds Gain Modestly

Good morning,

The Dow (-0.7%), NASDAQ (0.5%), and S&P 500 (0.1%) finished the week mixed.  Meanwhile, taxable bonds gained 0.3% and tax-free municipal bonds gained 0.1%.  The 10-year Treasury yield fell 0.04% to finish the week at 4.15%.

The markets started the week down but made a recovery after the release of key economic data from October and November.  At long last, we finally received that data, which were delayed because of the government shutdown that lasted all of October and into November.  The jobs report showed that the US added 64,000 jobs in November, but lost 105,000 jobs in October, but that number was skewed by the decline of 162,000 Federal jobs.  Core retail sales for October rose 0.8%, above investors’ expectations.  Lastly, the Consumer Price Index (CPI – the most common inflation reading) rose 2.7% in November, down from 3.0% in September (there was no CPI report for October), with core CPI at 2.6%, its lowest level since 2021.

These economic reports were generally considered favorable, as one of the biggest concerns, inflation, appears to be in check.  The job market is weakening but not falling off the cliff.  However, before cheering too loudly, there is some question regarding the validity of the inflation data, as some key components were reported as 0.  We will have a much clearer picture of inflation after we make it into the new year.  Further, the AI stocks have seemingly been “on again – off again”, but showed some signs of recovery last week, as many of those stocks rallied.  The next couple weeks are expected to be slow on Wall Street, as we make our way through the thick of the holiday season.

Have a great day and terrific week, and Merry Christmas to all of you who celebrate the holiday.

^{Source:  Yahoo Finance}

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^{The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries. The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index. Government bonds and Treasury bills are guaranteed by the US government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.}