Big Movers In November 2023
Shopify (SHOP): The e-commerce company reported strong quarterly results early in November and continued higher as Black Friday sales broke records.
Paycom Software (PAYC): The software company missed revenue estimates and issued weak guidance on signs that a product change hurt business.
Expedia (EXPE): The online travel company beat estimates and announced a new share buyback. It also received an investment from ValueAct Capital Management.
Cigna (CI): The health insurer dropped on reports it planned to merge with Humana in a potentially complicated transaction.
Insulet (PODD): The diabetes company rebounded from a four-month slide after reporting strong quarterly results.
APA (APA): The energy stock followed oil prices lower.
Key Economic Events Last Month
Productivity Jumps as Wage Costs Ease
Labor Productivity rose 4.7% in the third quarter, half a percentage point more than forecast. Labor costs fell by almost 1%. The news reduced worries about wages driving an inflation higher. (2/11)
Payrolls Miss; Joblessness Increases
Non-farm payrolls increased by less than expected in October. Wages also missed and unemployment rose more than forecast. The news reduced worries about interest-rate hikes. (3/11)
Inflation Slows More Than Expected
The Consumer Price Index (CPI) was unchanged in October, below estimates for a 0.1% increase. Core inflation was also lower than expected. The news reduced worries about rate hikes. (14/11)
Strong Start to Online Holiday Shopping
Black Friday showed a strong start to online holiday shopping, according to private data. MasterCard Spendingpulse reported an 8.5% increase. Adobe Analytics cited growth of 7.5%. (27/11)
Key Futures Contracts
| Product Name | Current Month | Expiration | Next Month | 1-Mon% |
|---|---|---|---|---|
| S&P 500 E-Mini (@ES) | ESZ23 (Dec) | 15 Dec 23 | ESH23 (Mar) | +8.7% |
| *S&P 500 E-Mini Micro (@MES) | MESZ23 (Dec) | 15 Dec 23 | MESH24 (Mar) | +8.7% |
| Nasdaq-100 E-Mini (@NQ) | NQZ23 (Dec) | 15 Dec 23 | NQH24 (Mar)/td> | +10.2% |
| *Nasdaq-100 E-Mini Micro (@MNQ) | MNQZ23 (Dec) | 15 Dec 23 | MNQH24 (Mar) | +10.2% |
| Dow Jones E-Mini (@YM) | YMZ23 (Dec) | 15 Dec 23 | YMH24 (Mar) | +8.6% |
| *Dow Jones E-Mini Micro (@MYM) | MYMZ23 (Dec) | 15 Dec 23 | MYMH24 (Mar) | +8.6% |
* Micro contracts are one-tenth the size of standard e-minis.
Events to Watch This Month
| Date | Event | What to Watch |
|---|---|---|
| Fri, 8-Dec | Employment report | Job-market conditions: unemployment, wages, hours worked. |
| Tue, 12-Dec | Consumer price index (CPI) | Inflation trends |
| Wed, 13-Dec | Federal Reserve meeting, press conference | Interest rates, comments on inflation, labor market and restrictiveness of current policy |
| Thu, 14-Dec | Retail sales | Will sales beat estimates for a fifth straight month? |
| Tue, 19-Dec | Housing starts, building permits | Housing-market activity |
Sector Watch
Technology rose the most in November, fueled by stocks like Salesforce.com, Nvidia and Microsoft and Apple.
Real estate stocks had their biggest monthly gain in at least eight years as interest rates fell.
Consumer discretionary stocks rallied, including homebuilders, retailers and travel companies.
Energy fell as oil prices declined.
Noteworthy Calls & Predictions
U.S. inflation could slow to 2% by next June, according to ING Economics. Lower rents, falling energy costs and tighter financial conditions are helping drive the trend. Such a drop would align price pressures with central bank targets.
InflationThe Federal Reserve won’t hike interest rates again, according to Moody’s Analytics Chief Economist Mark Zandi. He cited October’s cooler-than-expected inflation report, noting lower prices for energy and new vehicles.
Interest ratesThe Fed may cut interest rates as early as March, Wharton School Professor Jeremy Siegel said in a CNBC interview. He said inflation is ending because tight monetary policy is squeezing liquidity.
Interest ratesU.S. could see deflation before the end of 2023, Walmart CEO Doug McMillon said on the company’s earnings call.
InflationArtificial intelligence (AI) will continue to drive growth in the technology sector, according to UBS analysts. They predicted software and Internet stocks will monetize previous investments in the field. Semiconductors could also benefit, they said.
Technology stocksDisclosure
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