The Week on Wall Street
Investor optimism and fears of missing out on future gains propelled stocks higher in the last full week of trading before year-end.
The Dow Jones Industrial Average added 0.22%, while the Standard & Poor’s 500 gained 0.75%. The Nasdaq Composite index advanced 1.21% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, added 0.51%.1,2,3
Stocks Build on Gains
The current market narrative of declining inflation, easing interest rates, and better earnings ahead continued to fuel stock market gains, with some of the year’s laggards, such as smaller cap stocks and energy names, leading the way.
While the stock market has repeatedly seen gains gather steam in the final trading hours, a late-day sell-off on Wednesday unnerved investors. While it’s difficult to know precisely why, the sharp decline may have resulted from profit-taking and low trading volumes, which can result in unexpected volatility or other technical reasons. Whatever the case, stocks rebounded nicely the following day and Friday.
Housing Revival?
The housing market struggled this year amid higher mortgage rates and rising home prices. Last week, several housing reports suggested the housing market may be improving.
New home construction rose 14.8% in November, reaching levels not seen since May, while existing home sales rebounded 0.8%, reversing five straight months of declines. Existing home sales have been hurt by low inventory since many homeowners with low-rate mortgages are hesitant to move and take on a higher-rate mortgage. This logjam may loosen as 30-year mortgage rates fell from 7.79% at the end of October to 6.95% in mid-November.4, 5
New home sales disappointed, however, falling 12.2%, though they came in 1.4% higher from November a year ago.6
John Dombroski Jr. may be reached at (480) 991-1055 or [email protected]
www.grandcanyonplanning.com
Know someone who could use information like this?
Please feel free to send us their contact information via phone or email. (Don’t worry – we’ll request their permission before adding them to our mailing list.)