S&P 500 is climbing upwards
S&P 500 is climbing upwards
The S&P 500 rebounded with a modest 0.36% gain today. The market’s move reflects ongoing digestion of mixed US economic data, supportive seasonality, and cautious optimism among investors.
US Economic Data Highlights
Data provided a mixed snapshot of the US economy, contributing to the market’s recent fluctuations:
- **EIA Crude Oil Inventories:** Fell by -1.844M barrels, exceeding the forecast of -1M, signaling tighter supply conditions.
- **US GDP Growth (Q3, Second Estimate):** Steady at 2.8%, unchanged from the previous estimate, highlighting consistent economic expansion.
- **Personal Consumption and Spending:** October’s real personal consumption rose by just 0.1% (forecast: 0.2%), while consumer spending grew by 0.4%, meeting expectations but showing a slowdown from revised data of 0.6%.
- **Durable Goods Orders:** Increased by 0.2%, falling short of the 0.5% forecast, reflecting weaker demand for long-term goods.
- **PCE Price Index (YoY):** Increased to 2.3%, matching expectations but higher than the prior 2.1%, indicating persistent inflationary pressures.
Market Sentiment and Seasonality
Seasonality continues to work in favor of the S&P 500, as historical trends during this period often support equities. The **Fear & Greed Index**, currently at **64 points**, reflects moderate optimism and a "Greed" sentiment, which typically aligns with risk-on behavior in the markets.
Rate Cut Expectations
Markets remain focused on the Federal Reserve’s upcoming meeting on **December 18th**, with a **66,3%% probability** currently priced in for a **25 basis-point rate cut**. Such a move could provide additional support for equities by easing financial conditions, though its long-term impact remains uncertain.
Geopolitical Risks
While market sentiment has improved slightly, risks remain in the background. The ongoing war in Ukraine continues to pose threats to global stability, with potential knock-on effects on energy prices, supply chains, and economic performance.
Long-Term Trend Intact, but Volatility Likely
The S&P 500’s long-term upward trend remains intact, bolstered by supportive seasonality, stable GDP growth, and investor optimism. However, the current environment of mixed economic data and rising policy uncertainty suggests that market volatility could persist in the short term.
Broader Context
Yesterday’s data underscored a steady but moderating US economy, while forward-looking risks remain:
- **Global Economic Outlook:** The S&P Global forecast anticipates global GDP growth of approximately 3% by 2025, with US growth slowing to below 2% next year and China toward 4%.
- **US Policy Risks:** Potential policy shifts under the new administration could elevate inflation pressures and tighten financial conditions, introducing further uncertainty for equity markets.
Implications for S&P 500
Today’s modest gain shows resilience in the face of mixed signals from economic data and global risks. With supportive seasonality and a strong likelihood of a December rate cut, the S&P 500 may find short-term support. However, investors should remain vigilant, as volatility is likely to persist amid policy uncertainties and geopolitical risks.
What’s your outlook for the S&P 500 after today’s rebound? Can the market sustain its gains, or will headwinds from mixed data and global risks take over? Share your thoughts in the comments!
The S&P 500 rebounded with a modest 0.36% gain today. The market’s move reflects ongoing digestion of mixed US economic data, supportive seasonality, and cautious optimism among investors.
US Economic Data Highlights
Data provided a mixed snapshot of the US economy, contributing to the market’s recent fluctuations:
- **EIA Crude Oil Inventories:** Fell by -1.844M barrels, exceeding the forecast of -1M, signaling tighter supply conditions.
- **US GDP Growth (Q3, Second Estimate):** Steady at 2.8%, unchanged from the previous estimate, highlighting consistent economic expansion.
- **Personal Consumption and Spending:** October’s real personal consumption rose by just 0.1% (forecast: 0.2%), while consumer spending grew by 0.4%, meeting expectations but showing a slowdown from revised data of 0.6%.
- **Durable Goods Orders:** Increased by 0.2%, falling short of the 0.5% forecast, reflecting weaker demand for long-term goods.
- **PCE Price Index (YoY):** Increased to 2.3%, matching expectations but higher than the prior 2.1%, indicating persistent inflationary pressures.
Market Sentiment and Seasonality
Seasonality continues to work in favor of the S&P 500, as historical trends during this period often support equities. The **Fear & Greed Index**, currently at **64 points**, reflects moderate optimism and a "Greed" sentiment, which typically aligns with risk-on behavior in the markets.
Rate Cut Expectations
Markets remain focused on the Federal Reserve’s upcoming meeting on **December 18th**, with a **66,3%% probability** currently priced in for a **25 basis-point rate cut**. Such a move could provide additional support for equities by easing financial conditions, though its long-term impact remains uncertain.
Geopolitical Risks
While market sentiment has improved slightly, risks remain in the background. The ongoing war in Ukraine continues to pose threats to global stability, with potential knock-on effects on energy prices, supply chains, and economic performance.
Long-Term Trend Intact, but Volatility Likely
The S&P 500’s long-term upward trend remains intact, bolstered by supportive seasonality, stable GDP growth, and investor optimism. However, the current environment of mixed economic data and rising policy uncertainty suggests that market volatility could persist in the short term.
Broader Context
Yesterday’s data underscored a steady but moderating US economy, while forward-looking risks remain:
- **Global Economic Outlook:** The S&P Global forecast anticipates global GDP growth of approximately 3% by 2025, with US growth slowing to below 2% next year and China toward 4%.
- **US Policy Risks:** Potential policy shifts under the new administration could elevate inflation pressures and tighten financial conditions, introducing further uncertainty for equity markets.
Implications for S&P 500
Today’s modest gain shows resilience in the face of mixed signals from economic data and global risks. With supportive seasonality and a strong likelihood of a December rate cut, the S&P 500 may find short-term support. However, investors should remain vigilant, as volatility is likely to persist amid policy uncertainties and geopolitical risks.
What’s your outlook for the S&P 500 after today’s rebound? Can the market sustain its gains, or will headwinds from mixed data and global risks take over? Share your thoughts in the comments!
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💲 To keep up to date with all my activities I invite you to visit my Telegram 💲
💲 t.me/Investmatez 💲
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