Spencer Platt
U.S. stocks on Monday climbed, extending a three-week win streak that has seen the benchmark S&P 500 (SP500) post gains in every day of November so far barring two.
This week will be quiet in terms of news flow as the bulk of the third quarter earnings season is done, though Nvidia’s results on Tuesday will garner significant attention. The economic calendar is largely empty and the Thanksgiving holiday on Thursday could also contribute to light volume.
The Nasdaq Composite (COMP.IND) led gains among Wall Street’s major averages, rising 0.82% to 14,241.57 points in mid-day trade. The tech-heavy index was buoyed by Microsoft (MSFT) which hit a record high after the tech giant brought on former OpenAI co-founders Sam Altman and Greg Brockman to lead a new advanced artificial intelligence team. The hiring came after a shock move by OpenAI’s board on Friday to oust Altman as top boss.
The S&P 500 (SP500) was higher by 0.46% to 4,534.70 points, while the blue-chip Dow (DJI) added 0.37% to 35,076.62 points. The former is coming off its best weekly win-streak since late July, largely driven by a general market consensus that the Federal Reserve is done hiking interest rates.
“The story of November so far has been markets pricing a dovish pivot for the 7th time since the global rate cycle started to turn 2 years ago. So despite the weak data there’s been a phenomenal rally, and Bloomberg’s global 60/40 index is on track for its best monthly performance since the vaccine news three years ago,” Deutsche Bank’s Jim Reid said.
“Generally the market has been too early to price in cuts. But that doesn’t necessarily mean that the market is now wrong, since when we do get the pivot things often move quicker than expected. The median gap between the last hike and the first cut is only 4 months over the last 13 U.S. hiking cycles. We are already 4 months from the last hike and given the first full cut is priced for June 2024, that would be an 11-month period on hold, which would be the third longest gap between the last hike and first cut,” Reid added.
Looking at the performance of the 11 S&P sectors on Monday, nine were in the green, led by Technology. Utilities and Consumer Staples were the two losers.
Treasury yields were little changed. The world’s biggest bond market will be in focus ahead of a $16B 20-year Treasury auction later in the day, especially after a closely watched $24B 30-year auction eleven days ago tailed by its biggest margin ever.
The 30-year yield (US30Y) was flat at 4.60%, while the 10-year yield (US10Y) was up 1 basis point to 4.45%. The shorter-end more rate-sensitive 2-year yield (US2Y) was also up 1 basis point to 4.92%.
See live data on how Treasury yields are doing across the curve at the Seeking Alpha bond page.
U.S.-listed Argentinian stocks grabbed some of the spotlight on Monday, staging a broad-based advance after far-right libertarian Javier Milei won the country’s presidential election on Sunday. The Global X MSCI Argentina ETF (ARGT) surged around 12%. Meanwhile, U.S.-listed shares of YPF (YPF) soared about 39% after Milei’s victory sparked speculation that the state-owned energy firm could benefit from economic reforms.
Among other active movers, Boeing (BA) was among the top percentage losers on the S&P 500 (SP500), after the planemaker was upgraded by Deutsche Bank on the expectation of higher cash flow from rising aircraft deliveries.
