Wall Street rose this holiday-shortened trading week, as the Dow, S&P 500 and Nasdaq finished with gains of about 1% each. It was the fourth consecutive week of gains for the major averages. The measures come on the back of continued hope that inflation is coming down and that the Federal Reserve is done raising interest rates. Treasury yields hit multi-month lows during the week, and the federal funds rate remained below 4.5%, despite a slight move higher on Friday. (Treasury bond yields tend to move inversely to stock prices; as yields fall, investors seeking better yields move money back into the stock market.) For us, the main event of the week was the release of Nvidia's results on Tuesday after the bell. The chip manufacturer once again arrived at its quarterly edition with very high expectations on the street, but once again exceeded them. Forecasts for the current quarter, the final three months of Nvidia's fiscal 2024, were equally strong. Still, Nvidia (NVDA) stock fell modestly. We attribute this to the usual concerns about the boom and bust in the semiconductor industry, as well as some profit-taking after stocks' meteoric rise this year. It is still a stock to own, not trade. The other important factor is the Christmas shopping season. Black Friday through Cyber โโMonday is a huge four-day period for retailers, including those in our portfolio like Apple, TJX Companies, Foot Locker, Amazon and Estee Lauder. This start to shopping is not the end all be all, it is exclusive to retail, but it can set the tone. Therefore, next week we will take a closer look at the data that can give us an early idea of โโhow the season is shaping up. The signals have been a bit mixed, with some predicting spending growth compared to last year and others expecting it to remain broadly stable. Additionally, there are a few more macroeconomic releases coming out next week, along with two portfolio companies reporting earnings on Wednesday. Here are three main areas you should pay attention to. 1. Spending data: The most important economic release arrives on Thursday with the personal income and spending report. It is here that we find the crucial core PCE price index, the Federal Reserve's preferred measure of inflation. As of Friday, the consensus expectation is for a 3.5% annual growth rate, down from the 3.7% annual rate seen in the September report. Of course, anything closer to the Fed's 2% target would be welcomed by investors. On Wednesday, the second estimate of the Gross Domestic Price index for the third quarter is published. Provides a good high-level read on the state of the economy. But it's important to remember that GDP readings are very retrospective: we are already two months into the fourth quarter. For this reason, we place more emphasis on monthly economic releases, such as the aforementioned personal spending report. And even more so, we value feedback from management, which reveals what's happening now and also looks to the future. 2. Housing Update: New home sales are released on Monday and pending home sales are released on Thursday. Both reports should offer some insight into the cost of housing and the rate of housing cost inflation, a key monitoring topic for the Federal Reserve as it has proven to be a more difficult area of โโinflation that is still brewing. fighting. Until we get real relief on this front, let's not expect the Fed to abandon its vision of higher, longer interest rates. The last notable report of the week comes on Friday with the ISM manufacturing report. The ISM report measures the rate of contraction and expansion of the sector, measured by the distance from that 50-level benchmark. The further below 50, the faster the contraction. The higher it is above 50, the faster the expansion rate will be. At the moment, economists are forecasting a reading of 47.7, which would indicate a slower pace of contraction compared to the 46.7 reading we got in October. 3. Earnings: Foot Locker (FL) reports Wednesday before the opening bell. We do not expect a positive release, considering we previously trimmed our position. In addition to the reported results, feedback from management on the progress being made to right the ship will be key, as will updates on the holiday shopping season and inventory levels. Black Friday and Cyber โโMonday results won't be reflected in the reported numbers, so we'll have to listen to the call for more details. For Salesforce (CRM), which reports Wednesday after the bell, we're looking at how well management maintains the balance between growth and profitability. Without a doubt, artificial intelligence will also be a hot topic. But buzzwords aside, we want to hear what recent investments in AI, like Einstein GPT, are doing from a sales perspective. The pace of deal activity will also be another issue to consider: Are deals taking longer to sign? If so, what is management doing to address it? Here's the full rundown of all the important national data for next week. Monday, November 27 10:00 am ET: New Home Sales Before the Bell: Cerence (CRNC) After the Bell: Zscaler (ZS) Tuesday, November 28 10:00 am ET: Consumer Confidence Before the Bell: Pinduoduo (PDD), Bank of Nova Scotia (BNS), Elbit Systems (ESLT) After the bell: CrowdStrike (CRWD), Workday (WDAY), Intuit (INTU), Splunk (SPLK), Hewlett Packard Enterprise (HPE), NetApp (NTAP), AZEK (AZEK) Wed Nov 29 8:30am ET: Gross Domestic Price Index Before the Bell: Foot Locker (FL), Dollar Tree (DLTR), Petco (WOOF), Hormel Foods (HRL) ), Bilibili (BILI) After the bell: Salesforce (CRM), Snowflake (SNOW), Okta (OKTA), Synopsys (SNPS), Pure Storage (PSTG), Five Below (FIVE), PVH (PVH) Thursday, 30 November 8:30 a.m. ET: Personal spending and income 8:30 a.m. ET: Initial unemployment claims 10:00 a.m. ET: Pending home sales Before the bell: Kroger (KR), Big Lots (BIG), Academy Sports and Outdoors (ASO), TD Bank (TD), Royal Bank of Canada (RY) After the Bell: Marvell (MRVL), ULTA Beauty (ULTA), Dell Technologies (DELL), Ambarella (AMBA) Friday 12/10: 00am ET: ISM Manufacturing Before the Bell: Bank of Montreal (BMO) (See here for a complete list of Jim Cramer's Charitable Trust shares.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable fund's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH OUR DISCLAIMER. NO FIDUCIARY OBLIGATION OR DUTY EXISTS OR IS CREATED BY VIRTUE OF THE RECEIPT OF ANY INFORMATION PROVIDED IN RELATION TO THE INVESTMENT CLUB. NO SPECIFIC RESULTS OR BENEFITS ARE GUARANTEED.
Foot Locker, sports shoe store with buyer.
Jeff Greenberg | Universal Images Group | fake images
Wall Street rose this holiday-shortened trading week, as the Dow, S&P 500 and Nasdaq finished with gains of about 1% each. It was the fourth consecutive week of gains for the major averages.
The measures come on the back of continued hope that inflation is coming down and that the Federal Reserve is done raising interest rates. Treasury yields hit multi-month lows during the week, and the federal funds rate remained below 4.5%, despite a slight move higher on Friday. (Treasury bond yields tend to move inversely to stock prices; as yields fall, investors seeking better yields move money back into the stock market.)
