Wall Street Treads Water on Shortened Trading Day
Trading in the USA is back on track after the public holiday, but momentum is lacking. Attention has already turned to the upcoming OPEC+ meeting, which could indirectly benefit retailers.
Wall Street finished the last trading day of the week on a low note. Despite the "Black Friday" discount battle, it was consumer goods rather than stocks that drew shoppers' attention, according to reports. The Dow Jones rose by a meager 0.3%, reaching 35,390 points. The S&P-500 inched up 0.1%, while the Nasdaq Composite slipped 0.1%. Trading was cut short due to the Thanksgiving break the previous day, leading to minimal impulses and low turnover.
Market pundits took advantage of the quiet environment to reflect upon recent developments. Analyst David Morrison of Trade Nation expressed skepticism about the possibility of a year-end rally, remarking that the market's sharp recovery since October has been swift and substantial.
The market felt the weight of rising bond yields. Improved data from the services sector might have contributed to the bond losses. Nevertheless, the purchasing managers' indices for November revealed a mixed picture. While the industrial index slipped into contraction territory, the service index improved more than expected.
Investors are keeping a close eye on the Christmas shopping season. Retail giants such as Amazon, Walmart, and Target attracted attention due to their Black Friday sales. Some analysts predict that the 2023 Christmas season will resemble pre-pandemic sales levels.
Greg Bassuk of AXS Investments pointed out that the decline in oil prices and inflation could boost consumer spending power. This development is favorable news for retailers. He added, "Higher consumer spending and a strong earnings season will serve as a solid foundation to reverse some of the cautious retailer sentiment expressed during earnings reports."
Nvidia took a hit, dropping 1.9%. A report has revealed that the company is delaying the launch of its powerful artificial intelligence chip, H20, destined for China. The chip's release has been postponed due to new US export restrictions.
Meanwhile, iRobot saw a significant surge, jumping 39.1%. A report suggests that the EU is considering approving Amazon's acquisition of iRobot without any restrictions.
Vista Outdoor's shares rose 3.9% following Colt CZ Group's cash and share bid of nearly $1.7 billion for the company.
Bond yields climbed on the back of favorable economic data and the benchmark European market. The dollar index dropped by 0.5%.
The oil market witnessed another wave of price weakness. The ceasefire between Israel and Hamas and the OPEC+ meeting were key factors. Due to disagreements over production quotas, the meeting has been postponed until November 30, raising speculation that the expected production cuts might fall short of expectations.
As trading resumes with shortened hours and minimal impulses, Wall Street's focus has shifted from stock trading to the OPEC+ meeting. The Dow Jones managed a small increase of 0.3%, while the S&P-500 and Nasdaq Composite showed less positive results.
Retailers indulged in the spotlight during the Black Friday sales, with some analysts pondering that the 2023 Christmas season sales might mirror pre-pandemic levels. The positive retail sector impact can also be attributed to the fall in oil prices and the decline in inflation, as per Greg Bassuk of AXS Investments.
Source:
The OPEC+ meeting and its subsequent decisions have not significantly impacted stock market trends or retail sales in relation to the 2023 Christmas season. While the meeting might indirectly influence broader economic conditions via factors such as oil prices, market volatility, and supply chain risks, the ultimate impact on retail sectors remains uncertain.
