Here are the key news updates for investors to kickstart their trading day:
1. Dow 37,000: The Dow Jones Industrial Average made history by closing above 37,000 for the first time, fueled by optimistic sentiments on Wall Street following the Federal Reserve’s dovish signals about potential rate cuts in the coming year. The S&P 500 also reached a milestone, closing above 4,700 for the first time since January 2022, while the Nasdaq hit a 52-week high. Economic data to watch out for on Thursday includes weekly jobless claims, retail sales, imports for November, and the business inventories report for October.
2. Powell power: Fed Chair Jerome Powell is playing the role of Santa Claus for stock investors this year. The Federal Reserve’s policy-setting central bankers hinted at the possibility of cutting their benchmark rate three times in the upcoming year, aligning more closely with the market’s dovish expectations. Powell also declared victory over rising inflation, noting that it has eased from its highs without causing a significant increase in unemployment.
3. Meh-dobe: Adobe, the software maker, has experienced significant growth this year, with its shares climbing approximately 85% through Wednesday’s close, surpassing the solid gains of the S&P 500. However, the company faced a setback as its stock declined in extended trading due to the issuance of guidance for next year that fell short of analysts’ expectations. Adobe executives stated that they are closely monitoring spending and acknowledged reliance on price increases for some of their software may have been misplaced.
4. Scrooged: Amid the holiday season, layoffs have hit Etsy employees. Despite the marketplace’s substantial growth since 2019 fueled by the e-commerce boom during the Covid pandemic, economic pressures have compelled Etsy to cut 11% of its workforce. This move follows Hasbro’s announcement of slashing over 15% of its staff, approximately 1,100 jobs, indicating the challenging times faced by certain industries.
5. Budget blues: The ongoing Capitol Hill battle regarding aid for Ukraine may extend into the next year, potentially complicating the larger fight over the government budget in the early stages of the upcoming general election year. President Joe Biden is seeking $110 billion in additional aid for Ukraine as the country remains engaged in a war against Russian forces. The prolonged negotiations over aid could have broader implications for the government’s budgeting process.
Source (CNBC)
