This year the stock market has been adversely affected by multi-decade high inflation, aggressive rate hikes by the Fed to curb the price rise, and geopolitical turmoil. However, the October CPI report, showing signs of cooling inflation, and indications by the Fed to increase rate hikes at a slower pace, have raised consumer sentiments.
Moreover, the November jobs report came in better than expected, with nonfarm payrolls increasing by 263,000 for the month versus the Dow Jones estimate of 200,000. While the hot job market might induce the Fed to continue its rate hikes, these numbers show the economy’s strength. Additionally, Bank of America CEO Brian Moynihan expects a “mild recession” next year, providing optimism about the state of the economy.
