The Weekly Economic Outlook: December 2nd – December 6th
As we enter the first week of December ’24, the financial landscape is buzzing with anticipation as the labor market data takes center stage. The week is packed with crucial economic releases, culminating in the highly awaited November ’24 nonfarm payroll report on Friday, December 6th at 7:30 am.
The Treasury Rally: A Surprising Turn of Events
The recent Treasury rally has caught many by surprise, leading to speculation about its potential implications for the upcoming labor market data. Here’s a breakdown of how the Treasury yield curve shifted during the Thanksgiving holiday week:
– The decline in Treasury yields was the most significant rally since August 23rd.
– The rally was particularly pronounced for the , , and maturities, surpassing the late August rally.
Is the Treasury rally signaling weaker labor market data? With the estimate for November ’24 showing a potential gain of +200,000 jobs, investors are hopeful for a robust figure that reflects a cleaner picture of job creation without the previous obstacles like hurricane impacts and strikes.
Keep an Eye on the Dollar
The Treasury curve rally coincided with weakness in the UUP, indicating a correlation between Treasury movements and dollar performance. The next FOMC decision on Wednesday, December 18th, ’24, is expected to result in another 25 bp reduction in the fed funds rate.
S&P 500 Data Update:
– The forward 4-quarter estimate has risen to $263.58, marking the third consecutive week of sequential growth.
– The PE ratio on the forward estimate stands at 22.9x.
– The earnings yield has decreased to 4.37%.
Sector Growth Insights:
– Notable changes in sector growth rates for Q3 ’24 S&P 500 include .
– Commodities like and have seen downward revisions in growth rates.
In Conclusion:
The S&P 500 is experiencing a PE expansion phase since early October ’24, with significant growth post the election results in November. Uncertainty looms over President Trump’s tariff policies and their impact on various sectors in ’25. The upcoming month will see key reports from companies like Oracle, Nike, Accenture, FedEx, and more, keeping investors on their toes.
Disclaimer: The information provided is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results, and investing carries inherent risks. All data is sourced from reputable sources. Thank you for reading.
Analysis:
This rewritten article offers a comprehensive overview of the upcoming economic data releases, Treasury market trends, S&P 500 data, and sector growth insights. The content is structured with clear headings and bullet points for easy readability. The inclusion of a disclaimer ensures transparency and highlights the importance of conducting thorough research before making investment decisions.
Overall, the article provides valuable insights for both seasoned investors and beginners, emphasizing the dynamic nature of financial markets and the need for informed decision-making.