Focus on Christmas business
Wall Street with slim profits
November 24th, 2023, 8:45 p.m
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After the holiday there will only be a shortened period of trading in the USA. Impulses are in short supply. The focus is already on the OPEC+ meeting. Good news for retailers could indirectly come from there.
Wall Street stood still on the last and shortened trading day of the week. On the day of the “Black Friday” discount battle, it was said that it wasn’t stocks on the purchase lists, but rather Christmas presents. The Dow Jones rose by 0.3 percent to 35,390 points. The broader S&P 500 gained 0.1 percent and the Nasdaq composite lost 0.1 percent. After the Thanksgiving break the day before, only shortened trading took place. Sales were correspondingly low.
Market players took advantage of the relative calm to take a look back: “The rally since the end of October was pretty spectacular and within a month made up for pretty much all the losses between the beginning of August and the end of October. Too fast and too much? Maybe,” said market analyst David Trade Nation’s Morrison skeptical about a potential year-end rally.
The market was somewhat impacted by rising prices again Bond returns. The fact that pension securities lost popularity may have been due to improved data from the service sector. Overall they were Purchasing managers indices November was mixed. The industrial index fell into contraction territory, but the service index improved a bit more than expected. The service sector is of central importance for economic development in the USA.
How will the Christmas business be?
Among the individual stocks were retailers like Amazon (unchanged), Walmart (0.9 percent) or Target (0.7 percent) in focus because of business on “Black Friday” – the traditional starting signal for the Christmas business. Some analysts expect the 2023 holiday season to be similar to the years before the Covid epidemic, meaning sales are unlikely to be as impressive as in the immediate post-pandemic period.
Meanwhile, Greg Bassuk of AXS Investments points out that the decline in oil prices and the decline in inflation could increase consumer purchasing power, which is a good sign for retailers. “Higher consumer spending and a strong earnings season will provide a strong foundation to reverse some of the cautious retail sentiment we heard in the recent earnings report.”
Nvidia fell 1.9 percent. The semiconductor company is postponing the launch of one of its new artificial intelligence chips destined for China, according to a report. The chip, called H20, is the most powerful of three China-focused chips that Nvidia has developed to comply with new US export restrictions. Irobot shot up 39.1 percent. According to a report, the EU wants to approve Amazon’s takeover of the robot vacuum cleaner provider without restrictions.
Shares of Vista Outdoor rose 3.9 percent after Czech weapons manufacturer Colt CZ Group made a cash and stock offer worth nearly $1.7 billion to the sports and outdoor goods group.
Yields on the bond market went up. Participants referred to the service economic data of the day and those of the past few weeks, which predominantly demonstrated the strength of the US economy. In addition, the bonds followed their European counterparts, which had already been under pressure on Thursday. The dollar index fell 0.5 percent.
Prices on the oil market once again tended to be weak. The focus was on the ceasefire between Israel and Hamas and the OPEC+ meeting. It was postponed due to differences of opinion on funding quotas and will only take place online. The consultations, which are now scheduled for November 30th, led to speculation that the expected production cuts could be smaller than expected. “If the current production level is maintained on balance, prices could temporarily fall slightly because there was no ‘more’,” predict Commerzbank analysts.