On December 20, 2024, a customer held a carton of eggs in a supermarket in the United States.
Sekouk Ankar | Anadolu | Getty Images
This report comes from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open keeps investors updated on everything they need to know, no matter where they are. Like what you see? You can subscribe here.
What you need to know today
US government shutdown suspended
The U.S. government almost President Joe Biden averts government shutdown after election sign Saturday’s stopgap government funding bill. President-elect Donald Trump and Elon Musk on Wednesday sharply criticized its terms, thwarting an initially negotiated financing plan and specifically insisting on a two-year suspension of the U.S. debt ceiling.
Price increases slow slightly
According to the personal consumption expenditures price index, the overall inflation rate in the United States in November increased only 0.1% from October. Prices rose 2.4% from the same period last year. Both readings were 10 basis points below expectations. Core inflation was also 10 basis points below forecast. PCE is the Fed’s preferred inflation gauge.
U.S. markets rebound
Friday, S&P 500 Index up 1.09%, Dow Jones Industrial Average increased by 1.18%, Nasdaq Index up 1.03%. But all indexes fell this week. Pan-European Stoke 600 It fell 0.88% and ended the week down 1.9%. Novo Nordisk Shares of the Danish pharmaceutical company plunged 17.8% after the company reported disappointing trial results for a new weight loss drug.
CEOs see the door
Blue chip companies e.g. boeing company, Intel and Starbucksannounced a CEO change this year. They are not alone. As of November this year, a total of 327 CEOs of U.S. public companies have left their jobs, according to employment consulting firm Challenger, Gray & Christmas. That’s the highest level since the company started tracking data in 2010.
(PRO) Will Rudolph’s red nose be more dazzling than Santa Claus?
After weeks of tumultuous trading, stocks are expected to post losses at the end of December. But Santa Claus rallies, which typically occur on the last five trading days of the year and the first two trading days of the next, could reignite seasonal cheer. According to the Stock Trader’s Almanac, data going back to 1969 shows the S&P has gained an average of 1.3%.
bottom line
But November’s PCE data was lower than expected. “Sticky inflation appears to be easing this morning,” said Chris Larkin, managing director of trading and investing at Morgan Stanley E-Trade.
The Fed has repeatedly emphasized its “reliance on data.” So, if the Fed had a chance to review the PCE data first, would they show the world a slightly different dot plot?
Chicago Fed President Austan Goolsbee told CNBC’s Steve Liesman that he has some confidence in this line of thinking and that he hopes the November inflation data “shows The strength of these past few months has been more of a bump than a change of path.” In other words, the economy “is still on track to hit 2%,” Goolsby said.
Powell said again in July that the central bank would “rely on data but not on data points” when deciding when to cut interest rates. Even if November’s PCE index does suggest that inflation is back on a downward trajectory, one month of data won’t change that. Maybe two months of calm reading could do the trick?
These questions are rhetorical questions. Conditional questions are impossible to answer, especially in the market. But because of their uncertainty and circuitous nature, they underscore the fact that trying to time the market or game the market, especially during volatile times like these, may not be the best idea.
Instead, dig deeper into the fundamentals—earnings, cash flow, future revenue—these factors will affect stocks even if inflation and interest rates rise or fall. Remember the days when inflation reports and Fed meetings were just another day in the market? (Not a rhetorical question.)
—CNBC’s Jesse Pound, Brian Evans and Sean Conlon contributed to this report.
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