U.S. Stocks Posting Modest Gains Amid Light Trading
After showing a lack of direction earlier in the session, stocks have moved modestly higher over the course of the trading day on Friday. The major averages have all moved to the upside, although buying interest remains relatively subdued.
Currently, the major averages are holding on to slim gains. The Dow is up 35.72 points or 0.1 percent at 34,981.19, the Nasdaq is up 33.78 points or 0.2 percent at 14,147.46 and the S&P 500 is up 10.20 points or 0.2 percent at 4,518.44.
The modest strength that has emerged on Wall Street may partly reflect recent upward momentum, which has helped propel the Dow and the Nasdaq to their best levels in three months. The S&P also recently set a two-month high.
Optimism about the outlook for interest rates has contributed to the recent advance, as the latest data has shown signs of easing inflation.
The data has reinforced investors’ expectations that the Federal Reserve will refrain from raising interest rates over the next several months before cutting rates in mid-2024.
The Fed’s next monetary policy meeting is scheduled for December 12-13, with CME Group’s FedWatch Tool currently indicating a 100.0 percent chance the central bank will leave rates unchanged.
However, some economists have suggested Fed officials will maintain a somewhat hawkish tone to avoid the appearance of declaring victory over inflation too soon.
In U.S. economic news, the Commerce Department released a report showing an unexpected increase in new residential construction in the month of October.
The report said housing starts jumped by 1.9 percent to an annual rate of 1.372 million in October after surging by 3.1 percent to a downwardly revised rate of 1.346 million in September.
Economists had expected housing starts to dip to a rate of 1.350 million from the 1.358 million originally reported for the previous month.
The Commerce Department said building permits also shot up by 1.1 percent to an annual rate of 1.487 million in October after plunging by 4.5 percent to a revised rate of 1.471 million in September.
Building permits, an indicator of future housing demand, were expected to decrease to a rate of 1.450 million from the 1.475 million originally reported for the previous month.
Sector News
Energy stocks continue to see significant strength in afternoon trading, rebounding along with the price of crude oil.
With crude for December delivery surging $2.84 to $75.74 a barrel, the NYSE Arca Oil Index is up by 2.7 percent and the Philadelphia Oil Service Index is up by 2.4 percent.
Networking stocks are also seeing considerable strength after falling sharply on Thursday, driving the NYSE Arca Networking Index up by 1.5 percent.
Financial, steel and retail stocks have also moved to the upside over the course of the session, while modest weakness has emerged among gold stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Friday. Japan’s Nikkei 225 Index rose by 0.5 percent, while Hong Kong’s Hang Seng Index plunged by 2.1 percent.
Meanwhile, the major European markets have all moved to the upside on the day. While the U.K.’s FTSE 100 Index jumped by 1.3 percent, the French CAC 40 Index advanced by 0.9 percent and the German DAX Index climbed by 0.8 percent.
In the bond market, treasuries have shown a lack of direction over the course of the session. Currently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 1.3 basis points at 4.432 percent.
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