US Stocks On Track To Pause As Recent Gains, Data-Heavy Week Render Mood Cautious: Why This Analyst Thinks Market Will Chug Along Into Year-End

U.S. stocks could stall at the start of the new trading week as they come off a week when all three major averages advanced solidly. Trading in the index futures points to a modestly lower opening as investors look ahead to a data-heavy week that would offer more cues on inflation, growth, the state of the housing market, and the direction of monetary policy. Crude oil prices fell at the start of the week ahead of the OPEC+ meeting scheduled for the week.

Global cues are negative as Asian stocks moved to the downside amid worries concerning the outlook for China and the U.S., while the European markets have started on the back foot.

Cues From Past Week's Trading:

The major averages advanced solidly in the holiday-shortened week ended November 24 as investors braved some negative commentary from retailers and Nvidia Corp.’s NVDA China warning. Analysts factor in a year-end rally waiting to kick in, helping the major averages advance further for the year.

The Nasdaq Composite Index, the broader S&P 500 Index, and the 30-stock Dow Industrials Average posted their fourth straight week of advances. While the former two closed at nearly a four-month high, the Nasdaq Composite Index closed just shy off its four-month high.

Signaling the improvement in the breadth of the market rally, the Russell 2,000 Index, which was underperforming the major indices, has rebounded strongly and is in the black for the year.

US Index Performance In Week Ended Nov. 24

Analyst Color:

Carson Group’s Ryan Detrick sees the recent buoyancy in the market as a harbinger of more gains to come. In a post on X, formerly Twitter, he noted that the S&P 500 is up four weeks in a row, and over the four weeks, the index has gained more than 10%.

More importantly, each of the weeks saw an advance of 1% or more, the analyst said. “Previous similar signals were the hallmark of more gains,” he said, adding that the market was higher a year later eight of ten times, and the media return was 17.6%.

Commonwealth Financial Network Chief Investment Officer Brad McMillan said he viewed the consumer sentiment data released last week as positive. He said that the bump-up in the headline number of the University of Michigan’s consumer sentiment survey for November and a bigger bump-up in how people feel today are good signs for holiday shopping, especially with the holiday season approaching.

“With the Fed feeling better about inflation, and consumers feeling a bit better about everything, the economy and markets should keep chugging along into the end of the year,” the analyst said.

Futures Today

Futures Performance On Monday

In premarket trading on Monday, the SPDR S&P 500 ETF Trust SPY slipped 0.08% to $454.93, and the Invesco QQQ ETF QQQ edged down 0.08% to $389.21, according to Benzinga Pro data.

Upcoming Economic Data:

The week’s economic calendar is fairly loaded with some first-tier data that can move the market. Traders get to digest four housing market reports, namely the new home sales report for October, two house price survey reports for September, and the pending home sales report for October.

The other economic reports that will likely grab some attention are the routinely scheduled weekly jobless claims report, the Conference Board’s consumer confidence index for November, the second read of the third-quarter GDP report, the personal income and spending report for October, and the Institute of Supply Management’s manufacturing index for November.

A slew of Fed speeches, including two appearances by Fed President Jerome Powell, could also react to create some ripples.

The Commerce Department’s new home sales report is to be released at 8:30 a.m. ET on Monday is expected to show a seasonally adjusted annual unit rate of 721,000 for October compared to 759,000 for the previous month.

The Treasury will auction six-month and two-year notes at 11:30 p.m. ET and three-month and five-year notes at 1 p.m. ET.

See also: Best Futures Trading Software

Stocks In Focus:

• Walt Disney Co. DIS shares traded down over half a percent in premarket trading after the company’s animated musical comedy “Wish” did not do well at the Thanksgiving Day weekend box office.
• Crown Castle Inc. CCI climbed nearly 3.8% after the Wall Street Journal reported that Elliott Investment Management has built a stake in excess of $2 billion in the company.
• Cybersecurity company Zscaler, Inc. ZS will release its quarterly results after the market close.

Commodities, Bonds, Other Global Equity Markets:

Crude oil futures fell 1.84% to $74.15 in the early European session on Monday after finishing the week and ended November 24 down 0.46%. The OPEC+ meeting is scheduled for November 30, and member nations are expected to discuss production quotas.10

The benchmark 10-year Treasury note fell 0.018 percentage points to 4.466% on Monday.

Most major cryptocurrencies are swathed in a sea of red, with Bitcoin BTC/USD holding precariously above the $37,000 level.

In the currency market, the U.S. dollar is weaker against most major currencies ahead of a slew of economic data and Fed speeches. The greenback, however, is seeing marginal strength against the Canadian dollar.

Among equity markets, the major Asian market settled lower in a consolidation following their recent gains. The Indonesian market bucked the downtrend and settled slightly higher, and the Indian market was closed because of a public holiday. Data out of China showed a decline in profits of industrial profits for the first ten months of the year, although the decline was more modest than what was seen in the January-September period.

European stocks traded lower in late-morning deals on Monday.

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