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November closed as the best month of the year for the stock market, so December, which is often a good month, has a tough act to follow. The trend, however, suggests there will at least be an effort to keep things going even if they don't go nearly as well as they did in November.
The latter point notwithstanding, the equity futures market is looking a little groggy this morning as participants will themselves back to work after a festive holiday week that is the gateway to Christmas and New Year festivities. MasterCard Spending Pulse reports that Black Friday sales were up 3.4% year-over-year, led by strength in online sales. Brick-and-mortar sales were said to be up just 0.7% year-over-year.
Currently, the S&P 500 futures are flat and are trading fractionally above fair value, the Nasdaq 100 futures are up 31 points and are trading 0.2% above fair value, and the Dow Jones Industrial Average futures are down 22 points but are trading fractionally above fair value.
The sluggish disposition of the equity futures market belies what should be an active week of trading centered around political, economic, and earnings news.
Today will be mostly about political and economic news, although Walt Disney (DIS) will capture some added attention on the upbeat report that 'Moana 2' brought in $221 million in ticket sales over the Thanksgiving weekend, according to CNBC; meanwhile, Intel (INTC) is making headline waves with the news that Pat Gelsinger has suddenly "retired" from the company, which will be led by interim co-CEOs until a new CEO is hired.
In the realm of politics, the U.S. introduced more curbs on exports of semiconductors, specifically high-bandwidth memory chips, and semiconductor equipment to China that would be helpful in using advance AI for military applications, according to Reuters. Separately, President-elect Trump said he would impose 100% tariffs on BRIC countries if they work to undermine the U.S. dollar's reserve currency status.
The U.S. Dollar Index is up 0.6% to 106.32, helped in part by the divergent growth dynamics for Europe and the U.S.
We are also seeing a bump in market rates ahead of this morning's economic data that will include the final November S&P Global U.S. Manufacturing PMI (prior 48.5) at 9:45 a.m. ET, the October Construction Spending Report (Briefing.com consensus 0.1%; prior 0.1%) at 10:00 a.m. ET, and the November ISM Manufacturing PMI (Briefing.com consensus 47.6%; prior 46.5%) at 10:00 a.m. ET.
The 2-yr note yield is up six basis points to 4.22% and the 10-yr note yield is up five basis points to 4.23%.
The big report of the week will be the November Employment Situation Report. It will be released at 8:30 a.m. ET on Friday and expectations about the path of monetary policy will be released along with it.
That is an indirect way of saying that this will be an important week of trading.
