Stocks Reach All-Time High Amid Israel Cease-Fire Agreement

The stock market saw impressive gains as major indexes hit record highs, inspired by optimism surrounding a cease-fire agreement between Israel and Hezbollah. This marked a pivotal moment, allowing investors to focus more on economic factors rather than geopolitical tensions.

The S&P 500 increased by 0.6%, while the Nasdaq 100 also rose by 0.6%. The Dow Jones Industrial Average experienced a smaller boost, gaining 0.3%. This continued a trend of gains, with the S&P 500 recording its 52nd all-time high of the year.

News of the cease-fire came shortly after oil futures settled, signaling a reduction in the geopolitical risks contributing to market uncertainty. In corporate news, Dell Technologies reported disappointing sales, and both HP Inc. and CrowdStrike Holdings provided less-than-encouraging forecasts.

Despite concerns about former President Donald Trump’s newest tariff proposals aimed at the nation’s leading trading partners, Wall Street remained largely unfazed. Notably, tech giant Microsoft helped lift software stocks, which are typically less affected by tariffs. However, traditional automakers like Ford and General Motors faced challenges due to their significant business ties to China and Mexico.

Experts see the tariffs as primarily a negotiation strategy rather than a substantial policy tool. According to Andrew Brenner from NatAlliance Securities, the impact of these tariffs is likely to be minimal.

In other financial news, US 10-year Treasury yields rose by two basis points to reach 4.30%. Additionally, a measure of the dollar strengthened by 0.2%, while currencies such as the Mexican peso and Canadian dollar faced declines.

Market analysts like Dennis DeBusschere from 22V Research believe that Trump’s focus on tariffs as they relate to drug prices and immigration suggests a tactical approach rather than one grounded purely in economic concerns.

Turnover in the stock market was moderate as traders prepared for the upcoming Thanksgiving holiday. The S&P 500, having surged over 25% in 2024, is on track for another year of attractive returns above 20%—a feat accomplished only four times in the past century.

Looking ahead, Deutsche Bank’s Bankim Chadha predicts the S&P 500 could reach 7,000 points by the end of next year, signaling robust momentum. Other experts, such as Savita Subramanian from Bank of America, predict continued double-digit gains, particularly highlighting opportunities in individual stocks outside the primary index.

Goldman Sachs recommends investors to embrace US equities but also suggests diversifying portfolios to mitigate potential risks associated with the concentration of gains among the largest tech stocks, often referred to as the 'Magnificent Seven.'

Corporate Highlights

• Urban Outfitters Inc. saw impressive sales growth in its third quarter, especially from its Anthropologie brand.

• Nordstrom Inc. adjusted its annual sales guidance upward, hinting at potential strategic moves to take the company private.

• Amgen Inc. faced challenges as its experimental obesity medication underperformed against competitors.

• Kohl’s Corp. cut its sales outlook, indicating struggles within the retail sector.

• Dick's Sporting Goods Inc. raised its full-year sales estimate after strong demand for sports products.

• Best Buy Co. lowered its sales forecast amid ongoing weak demand for electronics.

• JM Smucker Co. improved its earnings guidance thanks to strong sales of its Uncrustables product line.

Key Upcoming Events

• U.S. Personal Consumption Expenditures (PCE), jobless claims, and GDP numbers are due on Wednesday.

• Eurozone consumer confidence results are expected on Thursday.

• The U.S. markets will close on Thursday for the Thanksgiving holiday.

• Friday will see the release of Eurozone Consumer Price Index (CPI) data.

• The European Central Bank will publish a survey on consumer expectations from October on Friday as well.

• Friday is also known as "Black Friday,” marking the start of the holiday shopping season in the U.S.

Market Overview

Here's a brief look at the market performances as of 4 p.m. New York time:

• The S&P 500 rose 0.6%.

• The Nasdaq 100 increased by 0.6%.

• The Dow Jones Industrial Average gained 0.3%.

• The MSCI World Index climbed 0.2%.

Currency Movements

• The Bloomberg Dollar Spot Index rose 0.2%.

• The euro dropped 0.1% to $1.0482.

• The British pound remained steady at $1.2559.

• The Japanese yen appreciated by 0.8% to 153.06 per dollar.

Cryptocurrency Shift

• Bitcoin experienced a decline of 2.9%, trading at $91,004.89.

• Ether fell by 3.4% and is currently priced at $3,321.02.

Bond Market Update

• The yield on 10-year Treasuries went up two basis points to 4.30%.

• Germany’s 10-year yield decreased by two basis points to 2.19%.

• UK 10-year yields increased slightly, gaining one basis point to 4.35%.

Commodities Overview

• West Texas Intermediate crude oil dropped 0.4% to $68.66 a barrel.

• Spot gold rose by 0.3% to $2,631.80 an ounce.

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