S&P 500 and Dow futures remain near records ahead of key inflation data

U.S. stocks remained near record highs on Wednesday as investors awaited the reading of the Federal Reserve’s most popular inflation gauge, which would provide clues about the direction of interest rates.

S&P 500 futures (ES=F) and Dow Jones Industrial Average futures (YM=F) were little changed, hitting new all-time highs for the indices. Contracts on the tech-heavy Nasdaq 100 (NQ=F) fell 0.3%.

Sentiment is subdued in the wake of the Thanksgiving holiday, when markets will close on Thursday and close earlier on Friday. But the Fed is back in the spotlight after being somewhat overshadowed by the debate over the impact of Donald Trump’s tariff plans and Cabinet decisions.

The October printout of its preferred inflation indicator, the personal consumption expenditures index, is scheduled to be released Wednesday morning. The focus is on whether inflation has stalled, as some officials believe, and minutes from the Fed’s last meeting suggested a cautious stance on rate cuts.

Economists expect annual “core” PCE – which excludes food and energy – to have been 2.8% in October, up from 2.7% in September. Pressures in line with these expectations are likely to weigh on bets for a rate cut in December. Traders currently believe the likelihood of the Fed keeping interest rates steady this meeting is about 34%, compared to about 24% last month, according to the CME FedWatch tool.

The second estimate of GDP for the third quarter, also released on Wednesday, remained unchanged and showed the U.S. economy grew at an annual rate of 2.8% in the period. Meanwhile, weekly jobless claims continued to decline, with 213,000 jobless claims filed in the week ending Nov. 23, compared to 215,000 the week before.

Trump on Tuesday named Jamieson Greer — a veteran of his first term — as U.S. trade representative. Given that Greer was instrumental in Trump’s original China tariffs, Wall Street is examining what his role could mean for the major new tariffs promised to the U.S.’s top trading partners.

On the corporate front, shares of Dell (DELL) fell over 10% after quarterly revenue fell due to slowing PC demand. Peer HP (HPQ) shares also fell 8% after earnings.

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Weekly jobless claims fall, GDP remains stable

Weekly jobless claims rose less than expected last week, hitting a seven-month low, as the impact of labor strikes and severe weather continued to fade.

New Labor Department data shows 213,000 initial jobless claims were filed in the week ending Nov. 23, down from 215,000 the week before and less than the 215,000 economists had expected.

Meanwhile, ongoing jobless claims reached 1.9 million, up 9,000 from the previous week and the highest level since November 2021.

Elsewhere in economic data, the second estimate of third-quarter GDP remained unchanged, again showing the U.S. economy grew at an annual rate of 2.8%.
Good morning Here’s what’s happening today.
About these possible Trump tariffs

Shares of automakers General Motors (GM) and Ford (F) were tanked on Tuesday following Trump’s tariff threats against Mexico, China and Canada.

GM lost 9% while Ford lost 3% as both companies have large presences in Mexico.

But of course, automakers aren’t the only companies that will be affected by the tariffs.

Think computers and t-shirts!

Here’s what HP Inc. (HPQ) CEO Enrique Lores and Abercrombie & Fitch (ANF) CEO Fran Horowitz told me about tariffs.

Enrique Lores

“Given the overall margin we have across categories, some of that (cost of potential tariffs) has to go to consumers. But here too we have to wait and see what the final tariffs look like so that we can define the exact tariffs.” The plan will be.

Fran Horowitz

“If we truly understand what is happening, we will have to make some adjustments and we will adjust accordingly,” Horowitz said. “This is exactly what we did in 2018 when we faced the same challenge. In 2024, we will receive no more than 5% or 6% of our U.S. revenues from China. We are looking at it country by country, but the agility we have built into our supply chain will really help us manage this situation.”