Stock Market Analysis for November 29, 2024

Summary of Last Week’s Performance

The week ending November 28, 2024, saw mixed results across major indices. The S&P 500 climbed 1.2% while the Nasdaq Composite dipped slightly by 0.4%. Concerns over inflation and potential Federal Reserve interest rate adjustments weighed on tech stocks, impacting market sentiment.

Key Events Impacting the Market

1. Federal Reserve Minutes Release: The release of the Fed’s minutes on Wednesday indicated possible interest rate hikes in early 2025 due to persistently high inflation rates. This caused volatility in interest-sensitive sectors.
2. October Consumer Spending Data: Released on Thursday, the October consumer spending numbers increased by 0.6%, reinforcing the resilient consumer sentiment but also raising fears of continued inflation.
3. Retail Earnings Reports: Positive earnings from major retailers buoyed the consumer discretionary sector, though concerns still lingered regarding supply chain disruptions.

Upcoming Events to Watch

1. Employment Report: The employment report for November will be released on December 4. Analysts will be looking for job growth and wage increases which could influence the Fed’s stance on interest rates.
2. Inflation Reports: November’s CPI data will come out mid-December. Expectations of high inflation may pressure the Fed to act more aggressively.
3. Q4 Earnings Season: Earnings for Q4 will begin to emerge in mid-December, giving investors insights into company performance amid economic pressures.

Predictions for Next Week

Given the current trends, the stock market may face continued volatility next week, particularly with the impending employment report. If job numbers are strong, we might see a further move in interest rates, potentially spurring market reactions.

Stock Recommendations

• Buy: Consider adding SPDR S&P 500 ETF Trust (SPY) as a long-term investment to leverage the overall market growth despite current volatility.
• Sell: If you hold individual tech stocks like NVIDIA (NVDA) or Meta Platforms (META), it may be prudent to take profits, given the cooling demand signs in the semiconductor and advertising sectors respectively.

Conclusion

The market remains at a crossroads, influenced by economic reports and Fed policy expectations. Keeping a diversified portfolio with a focus on ETFs like SPY while being cautious with high-beta stocks may be a sound approach in this turbulent environment.