Friday’s gains helped stocks wrap out the first full trading week of December. Investors saw the US monthly employment data favourably and embraced the idea that the Federal Reserve will begin lowering interest rates in 2019. As investors began to see more signs of a gentle landing for the economy, stocks began to rise.
The Dow Jones Industrial Average (^DJI) had a rise of 0.3%, or over 100 points, while the S&P 500 (\GSPC) reached a record high of 0.4%. Nearly 0.5% was gained by the tech-heavy Nasdaq Composite (^IXIC). The major indices had gained for six straight weeks.
The nonfarm payrolls data revealed a surprise drop in the US unemployment rate to 3.7% in November, suggesting that the labour market may not be cooling as swiftly as many had previously believed.
Meanwhile, when striking auto workers and Hollywood celebrities returned to the labour, the economy gained 199,000 jobs, up from the number from the previous month.
The data is expected to act as a litmus test for equities, which surged on investors’ growing confidence that the rate rises by the Fed have peaked and that a “soft landing” for the US economy is imminent. The labour market’s cooling signals in earlier statistics this week were interpreted as evidence that the Fed’s efforts to combat inflation are having an impact.
In other news, the UK antitrust agency stated on Friday that it will look into OpenAI’s collaboration with Microsoft (MSFT) in the context of a possible merger investigation. This action follows Thursday’s tech stock surge driven by AI hype, which saw increases for Alphabet (GOOGL) and AMD (AMD) following their product launches.
Although the price of oil has recovered, it is still headed towards its worst losing streak in five years as the market considers whether further cutbacks by OPEC+ will be sufficient to prevent a worldwide surplus. Crude futures for West Texas Intermediate (CL=F) and Brent (BZ=F) were both more than 2% higher.
Market observers and the general public will receive the Fed’s final word on 2023 next week. Even though it is generally anticipated that the central bank would maintain current interest rates, the meeting is significant because of its recommendations for the months to come.
When do central bankers think the rate-cutting process will begin? Many consumers and investors will be asking themselves this question when Fed Chair Jerome Powell provides the most recent information on efforts to achieve a smooth landing.
Next week will see the release of new inflation statistics that will help determine if the Fed is still making headway in its efforts to reduce price pressures.
A few corporate participants in the economy as well as the status of the economy itself will be revealed by the earnings reports from Costco, Oracle, and Adobe.
Elon Musk’s almost $800 billion electric car firm, Tesla, has been operating profitably. This year, the value of the company has risen despite Musk’s activities and statements related to platform X, formerly known as Twitter, which have sparked controversy and prompted a departure of advertisers.
However, in general, Tesla confronts a difficult combination of challenges, including growing rivalry as traditional automakers vie for market dominance in the EV segment, hazy demand for EVs, and persistent worries about the infrastructure needed for charging EVs. The margins are getting smaller. Authorities are also closely examining self-driving car promises and the range of electric cars.
So how can a CEO effectively steer a firm through such turmoil while devoting a large portion of their attention to a different, failing company?
“What good is X doing Tesla?”
“It is difficult to identify many CEOs who embody the company and brand to the extent that Elon Musk does for Tesla,” stated Garrett Nelson, senior equities analyst and vice president at CFRA Research. “For example, if X advertising revenue were to drop significantly and Musk needed to sell more Tesla stock to provide funding to X, that would affect Tesla’s stock price,” he stated.
The programme is an attempt by American multinational corporations to diversify their supply chains away from China following the country’s extreme measures to contain the COVID-19 outbreak. Compared to public health limitations in the US and other Western countries, the regulations were more stringent and in place for a longer period of time.
The source claims that after the initial expansion, Apple has plans to build tens of millions of more devices in India. Furthermore, an even larger portion of the world’s iPhone manufacturing would come from Indian production by the end of the decade. China will continue to be Apple’s primary iPhone maker, serving as both a vital market and a production centre.