Stocks, Bonds, Dollar Barely Budge After JOLTS: Markets Wrap
A rally that drove stocks to a series of all-time highs showed signs of fatigue, with traders sifting through the latest labor-market figures ahead of this week’s key jobs data.
(Bloomberg) -- A rally that drove stocks to a series of all-time highs showed signs of fatigue, with traders sifting through the latest labor-market figures ahead of this week’s key jobs data.
Equities struggled to make headway, following a relentless advance that sent S&P 500 to its 54th record this year. Treasuries and the dollar were little changed.
US job openings picked up in October, suggesting demand for workers is stabilizing after steep declines in recent months. The uptick in the so-called JOLTS report may indicate that demand for workers is stabilizing around pre-pandemic levels. That’s important for Federal Reserve officials who are trying to avoid any further weakening in the labor market as they gradually lower rates.
“From here, the market will be awaiting this afternoon’s Fedspeak with expectations for the comments to outline a willingness to cut on Dec. 18 in the event the data doesn’t surprise on the upside,” said Ian Lyngen at BMO Capital Markets.
The S&P 500 was little changed. The Nasdaq 100 fluctuated. The Dow Jones Industrial Average fell 0.2%. Salesforce Inc. is due to report results after the close. Germany’s main equity benchmark touched 20,000 for the first time.
Treasury 10-year yields were little changed at 4.19%. The South Korean won sank as President Yoon Suk Yeol declared martial law. Oil rose ahead of an OPEC supply meeting.
Short-sellers are capitulating as the S&P 500 keeps hitting record highs, according to Citigroup Inc. strategists led by Chris Montagu. Investor positioning in S&P 500 futures is “completely one-sided,” they wrote.
Equities will likely be exposed to risks such as tariff- and geopolitics-driven inflation, growth fears and a fizzling AI trade in 2025, according to HSBC strategists, who retained their expectations of a first-half rally.
The team led by Max Kettner says a more hawkish-than-expected Fed would also be a downside risk. On the other hand, deregulation, a strong rebound in China and synchronized pick up in global goods could support further gains in risk assets, they added.
The “Magnificent Seven” stocks are a buy during corrections as most of them will keep generating money, according to a New York University professor known for his expertise on valuations.
“As a value investor, I have never seen cash machines as lucrative as these companies are,” Aswath Damodaran, a finance professor at NYU’s Stern School of Business, said in a Bloomberg Television interview. “And I don’t see the cash machine slowing down.”
There will be corrections and “I’d suggest that when that happens you find a way to add at least one, maybe two or three of these companies, because these are so much part of what drives the economy and the market,” he added.
Corporate Highlights:
Key events this week:
Some of the main moves in markets:
Stocks
Currencies
Cryptocurrencies
Bonds
Commodities
This story was produced with the assistance of Bloomberg Automation.
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First Published:4 Dec 2024, 03:15 AM IST
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