Yahoo Finance Stock Market News for Jan 11, 2024
U.S. stock markets closed higher on Wednesday as investors wait for to key inflation data to be released this week. Moreover, market participants will keenly watch fourth-quarter 2024 earnings season, which will kick start this Friday. All three major stock indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) was up 0.5% or 170.57 points to close at 37,695.67. This marked the third-highest closing of the blue-chip index in its history. Notably, 20 components of the 30-stock index ended in positive territory, while 10 ended in negative zone.
The tech-heavy Nasdaq Composite finished at 14,969.65, surging 0.8% or 111.94 points due to strong performance of large-cap technology stocks. This marked the fourth straight days of positive closing for the tech-laden index.
Tech behemoths like Palo Alto Networks Inc. PANW and Meta Platforms, Inc. META, advanced 5.2% and 3.7%, respectively. Meta Platforms currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The S&P 500 rose 0.6% to finish at 4,783.45. The benchmark is just 13 points below of its record closing high of 4,796.56, recorded in January 2022. Seven out of 10 broad sectors of the broad-market index ended in positive territory while four in negative zone.
The Communication Services Select Sector SPDR (XLC), the Technology Select Sector SPDR (XLK) and the Consumer Discretionary Select SPDR (XLY) advanced 0.9%, 0.9% and 0.8%, respectively. On the other hand, the Energy Select Sector SPDR (XLE) declined 1%.
The fear-gauge CBOE Volatility Index (VIX) was down 0.6% to 12.69. A total of 9.81 billion shares were traded on Wednesday, higher than the last 20-session average of 12.22 billion. Advancers outnumbered decliners on the NYSE by a 1.4-to-1 ratio. On Nasdaq, a 1.1-to-1 ratio favored advancing issues.
Investors Try to Gauge Fed’s Move with Rate Cuts
Market participants remained clueless when the Fed will initiate first rate cut. Federal Reserve Governor Michelle Bowman said that she believes rate hike cycle is over. However, she is not yet convinced that the economy is in proper shape to initiate interest rate cut anytime soon.
Investors are also trying to assess the size of the rate cuts. Investors’ optimism about the first rate cut coming as early as March has somewhat faded. Investors are now pricing in a 59% chance that the Federal Reserve will go with a 25-basis point rate cut in March, which is sharply lower than last week’s readings of 70%.
Also, investors are waiting for the fresh inflation data that is scheduled for release later this week. This will give market participants a clearer picture of the Fed’s expected move.
Labor Market Remains Resilient
The Department of Labor reported that the U.S. economy added 216,000 jobs in December, beating the consensus estimate of 170,000. However, the metric for November was revised downward to 173,000 from 199,000.
The unemployment rate in December was 3.7%, flat month over month but below the consensus estimate of 3.8%. The average hourly wage rate increased 0.4% in December, flat with November but higher than the consensus estimate of 0.3%. Year over year, the wage rate increased 4.1% in December, beating the consensus estimate of 3.9%.
Economic Data
For the week ended Jan 5, U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased by 1.3 million barrels from the previous week.
Wholesale inventories in November dropped 0.2% month over month, in line with the consensus estimate. October’s data was revised upward to a decline of 0.3% from a drop of 0.4% reported earlier.
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