To The Moon

A big rally for U.S. stocks on Wednesday offset the impact of Monday’s decline, sending the major indexes to modest weekly gains. The $NASDAQ(.IXIC)$ added around 2%, the$S&P 500(.SPX)$ rose 1%, and the $DJIA(.DJI)$ finished up slightly.

The S&P 500 recorded its second monthly gain in a row during November, posting a 5.4% total return. All 11 sectors were positive; materials was the strongest performer (11.8%) and consumer discretionary was the weakest (1.0%).

The Fed's less hawkish stance and encouraging inflation data may trigger a huge rally in US stocks in December. December has proved to be a strong month in the past 70 years. See: December Trend Radar| Ready to Receive Christmas gifts as Scheduled?

However, before the release of November CPI, the key inflation data, on December 13, even bulls may hold a wait-and-see attitude, and the volatility it will bring will last until 2023.

Eric Beiley, executive director of wealth management at Steward Partners Global Advisory, said:

"The stock market may have bottomed out, because the Fed's interest rate hike may be nearing the end. When I looked forward to next year, I really believed that the Fed's interest rate hike policy will end, and may end in early 2023, because the interest rate hike has had an impact on curbing inflation and slowing the global economy."

Sectors & Stocks Performances Review

See from last week, consumer cyclical sector see the top gainning of 3.74%，then Communication Services，basic Materials are the second and third sectors by performances.

Sector and Stock Weekly performances

Weekly Top Gainers of $S&P 500(.SPX)$

The top 10 winners of $S&P 500(.SPX)$ are $Catalent(CTLT)$ ,$Etsy(ETSY)$ ,$PVH Corp(PVH)$ ,$Wynn(WYNN)$ ,$Fidelity National Information(FIS)$ ,$Netflix(NFLX)$ ,$Las Vegas Sands(LVS)$ ,$MarketAxess(MKTX)$ $Bath & Body Works Inc.(BBWI)$ $Estee Lauder(EL)$

Macro Factors to Watch

Fed Pivot: Stocks rallied on Wednesday after U.S. FED Chair Jerome Powell confirmed in a speech that smaller interest-rate increases could start as soon as the Fed’s December 13-14 meeting. Officials approved rate hikes of 75 bps at each of their last four meetings.

Earnings Scorecard: Companies in the $S&P 500(.SPX)$ posted an average earnings gain of 2.4% over the same quarter a year earlier, according to FactSet data from the recently concluded earnings season. That result marked the slowest growth rate since the third quarter of 2020. For the third quarter in a row, energy was the strongest among all 11 sectors, with earnings growth of 137.0% in the latest quarter.

CalmingTrend: Index that measures investors’ expectations of short-term U.S. stock market volatility fell for the sixth week out of the past seven. The $Cboe Volatility Index(VIX)$ slipped to the lowest level since mid-August and was down more than 43% from a recent high in mid-October.

Jobs Consistency: The labor market remains a source of strength in the weakened U.S. economy, as 263,000 new jobs were added in November. It marked the fourth consecutive month with jobs gains in the 200,000 to 300,000 range and the 23rdmonth in a row with at least 200,000.

Yield Decline: The yield of the 10-year U.S. Treasury bond tumbled to its lowest level in two and a half months, settling around 3.51% on Friday after ending the previous week at 3.69%. The fall in yields came amid continuing signs that high inflation has recently been moderating.

The Week Ahead: December 5-9

Monday

• Institute for Supply Management’s nonmanufacturing index
• Factory orders, U.S. Census Bureau

Tuesday

• Trade balance, U.S. Census Bureau

Wednesday

• Productivity and labor costs, U.S. Bureau of Labor Statistics
• Consumer credit, U.S. Federal Reserve

Thursday

• Weekly unemployment claims, U.S. Department of Labor

Friday

• Producer Price Index, U.S. Bureau of Labor Statistics
• University of Michigan Index of Consumer Sentiment, preliminary result
• Wholesale inventories, U.S. Census Bureau

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