Medicare Agent News: Stocks' Holiday Cheer

Wednesday, December 28, 2022

Stocks' Holiday Cheer

By Nicholas Jasinski | Wednesday, December 21

Rational Exuberance? Stocks surged higher today in a broad rally during a low-trading volume session before the year-end holidays. A handful of economic data releases were the day's main talking points.

The Dow Jones Industrial Average rose 1.6% and the Nasdaq Composite added 1.5%. The S&P 500 gained 1.5% as 469 S&P 500 stocks closed in the green. All 11 sectors of the index rose at least 1% today.

U.S. Treasury yields, meanwhile, eased off a bit after four straight days of rising yields.

Consumers are feeling better this month, data showed this morning. The Conference Board's December consumer confidence survey jumped 7 points from November, to 108.3. That handily beat the economist consensus estimate of 100.5 and is the highest reading since April. Importantly for the Federal Reserve, inflation expectations in the survey were at their lowest level since September 2021.

"Assessments of current conditions and expectations increased substantially," wrote Stephen Stanley, chief economist at Amherst Pierpont Securities. "It is particularly noteworthy that the gauges for both present and expected labor market conditions strengthened by about 4 points. The expectations figure was the brightest since January. Similarly, the evaluation of present business conditions improved by nearly 5 points and was the second-best since the summer of 2021."

As for what consumers are actually doing, we'll have more data this Friday morning. The Bureau of Economic Analysis will report November personal income and expenditures figures. Both earnings and spending are forecast to have risen 0.4% from October.

That report will also include the Fed’s preferred inflation gauge, the core personal-consumption expenditures price index. Economists on average expect it to be up 4.7% year over year, down from 5% a month earlier.

One thing that people aren't doing these days is purchasing homes at anywhere near the 2021 pace. Also reported this morning, November existing-home sales dropped 7.7% from a month earlier and were down 35.4% from the same month a year ago. The annualized pace of sales came in at 4.09 million, making November the second-slowest month since 2010.

It's also the 10th-straight month of declining existing-home sales—a record streak. Higher mortgage rates are making a serious dent in home-buying demand.

Barron's Shaina Mishkin has much more on the state of the U.S. real-estate market here.