Friday, December 20, 2024

Stocks rally after inflation data but close lower for the week

Stocks rally after inflation data but close lower for the week

By Chuck Mikolajczak

Fri December 20, 2024 4:30 PM

A correction has begun with all three indexes shooting straight up right out the gate, reaching their apex around noon, and staying there the rest of the day. The trigger was a combo PCE report that showed inflation slightly lower than expected and Fed officials indicating a more dovish approach than was announced Wednesday. It was enough to change the odds of 2025 rate cuts from two to three and for the first one to come as early as March instead of June.  

As today’s expert put it, “It’s this PCE plus dovish Fed commentary offset the market overreaction to the hawkish cut that everyone was expecting. We’ve seen this like 10 times during this Fed cycle. The market just always overreacts on one side or the other.” Yes, it was an overreaction and highlights just how skittish this market is and has been for quite some time. Today’s “triple witching” boosted the volume to 21.6 billion, way above the 14.9 billion-average, but also wholly inaccurate. Monday will tell a truer story.   

DJ: 42,342.24  +15.37       NAS: 19,372.77  -19.92        S&P: 5,867.08  -5.08         12/19

DJ: 42,840.26  +498.02     NAS: 19,572.60  +199.83     S&P: 5,930.85  +63.77      12/20

Fri 12-20-24 7:24 pm Stocks rally after inflation data but close lower for the week | Reuters


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