U.S. stocks closed on Thanksgiving, with technology leading the decline, as a surge in October inflation raised concerns that the Federal Reserve may cautiously pursue rate cuts in the future. Three major records ended in negative territory.
The Dow Jones Industrial Average (DJI) dropped 0.3% or 138.25 points, to close at 44,722.06 points. The Blue Devils recorded their first loss in six games.
The S&P 500 declined 0.4% or 22.89 points, to end at 5,998.74 points. Technology and consumer goods are the worst offenders.
The Consumer Discretionary Select Sector SPDR (XLY) lost 0.5%, while the Technology Select Sector SPDR (XLK) declined 1.4%. Six of the 11 sectors of the benchmark ended in negative territory.
The tech-heavy Nasdaq lost 0.6% or 115.10 points to finish at 19,060.48 points.
The benchmark CBOE Volatility Index (VIX) was down 1.42% to 13.90. Advancers outnumbered decliners on the NYSE by a ratio of 1.64-to-1. A total of 11.40 billion were traded on Wednesday, lower than the last 20-session average of 14.92 billion.
Wednesday light trading ahead of the Thanksgiving holiday, saw investors capitalizing on the benefits of major technology stocks that generally did well this year, sending the Nasdaq down. The moves came after new data showed inflation rose in October.
Personal consumption expenditures (PCE), the Federal Reserve’s preferred measure of inflation, rose 0.2% sequentially in October and 2.3% from a year ago. Core PCE, which excludes volatile food and energy costs, rose 0.3% month-over-month and 2.8% year-over-year.
While both the PCE price and core PCE are in line with consensus estimates, growing concerns that the Federal Reserve may reduce its numbers in the future. Inflation is still higher than 2% of the Federal Reserve and the central bank has previously said that although it will reduce interest rates, it will be slower.
Technology and sentiment suffered following the release of inflation news. Information about NVIDIA CORP.NVDA) fell 1.2%, while other tech like Meta Platforms, Inc. (META) and Salesforce, Inc.CRM) fell 0.8% to 3.5%. NVIDIA carries a Zacks Rank #2 (Buy). You can see A complete list of today’s Zacks #1 (Strong Buy) stocks here.
Trading volume will be low this week short of the holidays, as markets will close early Friday morning.
On Wednesday, the trading volume was almost one-fifth as compared to other days. Still, it’s been an interesting week so far, with the Dow and S&P 500 hitting all-time closing highs earlier this week. All three indexes are on track to end November in the green, with not much activity expected on the last trading day of the month.
#Market #Report #Nov