As investors took a break following the major averages’ four-week winning run, the Dow Jones Industrial Average declined on Monday.
At 0.1%, the Dow dropped 41 points. In contrast to the tech-heavy Nasdaq Composite, which rose over 0.1%, the S&P 500 fell by 0.1%.
The 10-year Treasury yield has fallen from the 5% level it briefly reached in late October, but stocks have rebounded, giving Wall Street its fourth consecutive week of gains. The Dow has gained almost 9% and the Nasdaq has increased by almost 12.8% this month, compared to the S&P 500’s 8.6% gain.
While Black Friday e-commerce sales increased 7.5% over a year before, some American retailers warned that consumer spending is slowing down, and still the rally went forward. On Cyber Monday, e-commerce stocks saw a rise. Specifically, shares of Shopify and Amazon increased by 5.4% and 1.2%, respectively.
The overall lacklustre expenditure figures may ultimately indicate that the economy is beginning to feel the effects of the Federal Reserve’s rate hikes.
Chief global strategist at LPL Financial Quincy Krosby stated, “A consumer slowdown would undoubtedly be a trigger for the market because it would help validate the basis for the rally.” “The robust foundation and high conviction that the Fed is done with its rate-hiking campaign and will start cutting rates in 2024 have helped this market.”
According to Krosby, the market has been in short-term overbought conditions for a number of sessions. He also stated that this week’s movements will be greatly influenced by the yield on the 10-year Treasury note, especially in light of this week’s Fed remarks and significant readings for inflation and consumer confidence.
Source (CNBC)
