Traders had plenty to think about last week as they focused on the results of the presidential election and the Federal Reserve’s move to further reduce interest rates. The major benchmark stock indexes closed up by the end of the week, with consumer discretionary, information technology, and financials outperforming. Bond prices ended the week higher, pulling yields lower. Crude oil prices rose to over $72.00 per barrel only to slip back a bit at the end of the week. The dollar inched higher, while gold prices declined. According to Freddie Mac, mortgage rates rose to 6.79% on November 7, the highest they’ve been in nearly four months.
Last Week’s Economic News
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By a unanimous vote, the Federal Open Market Committee (FOMC) decided to cut interest rates an additional 25.0 basis points. The federal funds target rate range is now 4.50%-4.75%.
- The international trade in goods and services deficit was $84.4 billion in September, up $13.6 billion, or 19.2%, from $70.8 billion in August.
- The S&P Global US Services PMI® Business Activity Index registered 55.0 in October, down slightly from 55.2 in September. A reading of 50.0 or higher indicates growth, thus services activity expanded solidly last month but at a slightly slower pace than in September.
- The national average retail price for regular gasoline was $3.069 per gallon on November 4.
- For the week ended November 2, there were 221,000 new claims for unemployment insurance, an increase of 3,000 from the previous week’s level
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Eye on the Week Ahead
The latest inflation data for October is available this week with the release of the Consumer Price Index, the Producer Price Index, and the report on import and export prices. The CPI rose 0.2% in September but ticked down 0.1 percentage point to 2.4% year over year. Producer prices, on the other hand, were flat in September and up only 1.8% since September 2023.
Have a nice week!
Sincerely,
Robert G. Carpenter