Tue 25 Nov: After the Bell
Your 5’ evening market wrap 📄📈
See the ‘Market Data’ post for tables & charts.
We started posting a ‘Morning Markets Update’ on Substack Notes at ~6 AM NYT — these updates won’t be emailed.
Good evening,
Stocks extended gains on Tuesday, with all major benchmarks advancing. The Dow Jones outperformed, supported by strength in Home Depot and UnitedHealth, while the Russell 2000 surged 2.3%. The S&P 500 and Nasdaq rose more modestly, weighed down by weakness in Nvidia, and the Healthcare sector led sector performance. The Vix volatility index retreated sharply from Friday’s spike of 28%, dipping below 19% and back to its 200-day moving average.
Nvidia shares plunged as much as 7% intraday before recovering to close 2.6% lower, following reports that Meta is in discussions to spend billions on Google’s AI chips, signalling Alphabet’s progress in challenging the top AI accelerator. Alphabet is trading at an all-time high, approaching a $4tn market cap.
Expectations of a Fed rate cut in December have supported markets, with futures now pricing in over an 82% probability of a quarter-point reduction from the current 3.75–4% range. This outlook also strengthened Treasuries, pushing yields lower as the 10-year note nears 4%, and weighed on the $, with the DXY index falling below 100, losing ground broadly against major currencies. Cryptos failed to follow equities, with Bitcoin lingering below $88,000 despite the stock rally.
Crude oil slipped over 1%, as optimism over a potential Russia-Ukraine peace framework and speculation of lighter future sanctions prompted traders to discount part of the geopolitical risk premium, reflecting the possibility of increased Russian supply reaching global markets.
Earnings: → Alibaba (mcap $377bn) reported Q2 revenue of ~$35bn, beating estimates thanks to strong growth in its cloud and “quick commerce” businesses, while net profit fell roughly 53% YoY as the company reinvested heavily in AI, cloud infrastructure, and one‑hour delivery. The stock rose 2% today and is 87% higher YTD. More.
→ Analog Devices (mcap $122bn) reported Q4 revenue of $3bn and EPS of $2.26 (+35% YoY), both beating expectations. The stock gained 5% today and is 17% higher YTD. More.
Economics: Overall, today’s US ‘delayed’ data is mixed, with consumer spending and employment showing some slowing, while housing has shown modest resilience.
→ US PPI inflation rose 0.3% in September, reversing August’s 0.1% decline, but came in slightly below the monthly consensus, while annual inflation held at 2.7%. This is the last inflation reading before the Fed meeting on December 10.
→ Retail Sales rose 0.2% MoM in September, and 4.3% YoY, reflecting slower growth than expected and a pullback by consumers.
→ Pending Home Sales rose 1.9% MoM in October, beating the 0.5% forecast, but it fell 0.4% YoY.
→ ADP Employment Change showed that private-sector payrolls continued to contract, with companies shedding an average of 13,500 jobs per week over the four weeks ending Nov 8 — a significantly deeper loss than the roughly 2,500-job weekly decline seen previously.
→ Finally, the US Consumer Confidence Index from The Conference Board plunged by 6.8 points to 88.7 in November—the biggest drop since April.
Central Banks: Kevin Hassett, Trump’s top in‑house economic adviser and a central architect of the White House’s growth, has emerged again as the President’s leading candidate to become the next Federal Reserve chair, with multiple reports saying he is now viewed inside Trump’s circle as the frontrunner for the nomination.
Business News: ABN Amro’s (mcap €23.5bn) new CEO Marguerite Bérard plans to cut 5,200 full-time jobs by 2028, nearly a quarter of the Dutch lender’s workforce of 22,000, as part of a cost‑reduction and profitability overhaul. ABN rose 6.5% today and is 93% higher this year.
Deals: It was a quiet day for M&A and IPOs. A KKR‑led consortium completed the sale in August of its stake in Tokyo’s Hyatt Regency hotel for over $800mn, announced now, likely doubling their 2023 investment. The 700‑room luxury hotel averages about $1.14mn per room and is located in Shinjuku.
Tomorrow: Data → US durable goods, initial jobless claims; Australia inflation. Earnings → Deere & Co.
A reminder that US markets will be closed on Thursday and will have an early close on Friday.
See you tomorrow.
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