Stocks finished higher on Friday as investors headed into the Christmas break on an up note after taking a beating in the previous session.
The Dow Jones Industrial Average finished up 176 points, or 0.53%. to 33,203, while the S&P 500 gained 0.59%, and the tech-focused Nasdaq advanced 0.21.%.
The benchmark 10-year Treasury was up at 3.751% in early New York trading, while the yield on the policy sensitive 2-year Treasury was up at 4.327%. Yields and prices move inversely.
Stocks ended sharply lower Thursday, dashing hopes of a last-minute Santa Claus rally, after strong consumer confidence data failed to offset negative news about future chip demand from Micron Technology (MU).
Those moves came as concerns of a recession resurged, piling coal on some investors’ hopes for a year-end Santa Claus rally -- a traditional period of gains ahead of the Christmas holiday.
Investors are concerned that over-tightening from central banks worldwide could force the economy into a downturn.
Investors Want to Recoup Their Losses
Additional concerns about a rapid increase in Covid cases in China following the government's recent about-face on its zero-Covid policy and whether the global economy will stall out even more come January also weighed on stocks.
The Dow ended the trading day Thursday down 348 points, or 1.09%, at 33,027, while the S&P 500 dropped 1.45%, with all S&P 500 sectors finishing lower, led to the downside by consumer discretionary. The Nasdaq lost 2.18%.
Investors dusted off their holiday sweaters on Friday in an attempt to recoup losses from what is shaping up to be the worst year for stocks since 2008.
The personal consumption expenditures price index rose 0.1% last month after climbing 0.4% in October, the Commerce Department reported.
The PCE price index increased 5.5% over the last year, making for the smallest annual gain since October 2021 and followed a 6.1% advance in October.
The core PCE-price index, which excludes volatile food and energy items, rose 4.7% on a year-on-year basis in November, also the smallest rise since October 2021, after increasing 5% in October.
Sales of newly constructed homes rose 5.8% in November from October, but were down 15.3% from a year ago, according to a joint report from the US Department of Housing and Urban Development and the US Census Bureau. This is the second consecutive month of sales increases.
'A Stock-Picking Market'
"The economic numbers announced today highlight the difficulty for investors today, where weak numbers bring recession fears and strong numbers bring Fed fear," said Louis Navellier, founder of money manager Navellier & Associates. "You just can't win right now on macro numbers."
"That is why it's now much more of a stock-picking market, but with all the index and ETF traders even stocks that are executing their business plan well can get pushed around meaningfully by associated losers," he added
Tesla (TSLA) shares fell 1.8% after CEO Elon Musk signaled he would not sell any Tesla stock for a minimum of 18-24 months. The chief executive has liquidated more than $39 billion in the company’s shares since the stock peaked in November 2021.
Facebook parent Meta (META) shares ended up nearly 1% after the social media giant agreed to pay $725 million to settle a class action lawsuit that claimed it gave third parties access to user data without their consent.
Microsoft (MSFT) shares finished slightly higher after the software maker on Thursday filed its response to U.S. regulators’ antitrust case attempting to block it from buying videogame publisher Activision Blizzard (ATVI), saying that the deal will not harm competition.
The Federal Trade Commission’s challenge to the proposed $68.7 billion acquisition stands out as the biggest government pushback Microsoft has dealt with on home turf since facing off against the Justice Department two decades ago over the dominance of Windows in the operating system market.
