Dec 15, 2023: U.S. stocks exhibited mixed performance on Friday, as certain investors secured profits following the surge post the Federal Reserve’s meeting, driven by optimism about the central bank’s ability to engineer a smooth economic transition next year.
As of 09:35 ET (14:35 GMT), the Dow Jones Industrial Average slightly dipped, the S&P 500 index lowered by 4 points (0.1%), while the NASDAQ Composite gained 32 points (0.2%).
Despite minor fluctuations, major Wall Street indices are set for their seventh consecutive positive week, marking their most robust weekly winning streak since 2019.
Fed’s Optimistic Stance The positive market sentiment stems from the Federal Reserve’s indication of future interest rate cuts from historic highs in the coming year. Stronger-than-expected retail sales data and a decline in annual inflation earlier in the week have bolstered hopes for a robust U.S. economic recovery in 2024.
New York Fed President John Williams mentioned in a CNBC interview that discussion about rate cuts remains premature, hinting that the central bank could adjust policy as necessary. While this tempered some investors’ bets on U.S. interest rate reductions next year, the overall sentiment remains upbeat.
The market anticipates more economic data, notably U.S. industrial and manufacturing production, both showing slight increases in November from the previous month’s sharp declines. Yet, focus primarily rests on the S&P Global Composite Flash PMI data for December, scheduled after the market opening.
Eurozone’s business activity downturn, revealed in the equivalent data earlier Friday, has intensified, indicating a likely recession in the bloc’s economy.
Costco’s Growth Amidst Demand for Affordable Products In corporate updates, Costco Wholesale (NASDAQ:COST) witnessed a 2.8% rise in stock value after the members-only retailer reported quarterly sales and profit that surpassed projections. The boost was attributed to increased demand for cost-effective groceries. Additionally, Costco announced a special dividend for shareholders.
Costco’s strategy to maintain lower prices has appealed to budget-conscious shoppers amid concerns about high inflation and interest rates, thus driving sales growth.
Oil Prices Set for Weekly Rise Oil prices experienced an uptick on Friday, eyeing their first weekly increase in two months, propelled by growing optimism surrounding next year’s demand growth and a weakened dollar.
As of 14:35 ET, U.S. crude futures traded 0.2% higher at $71.75 a barrel, while the Brent contract increased by 0.3% to $76.84 a barrel.
Both benchmarks are anticipated to record around 1% gains this week, breaking a seven-week losing streak.