Cautious ahead of Fed rate decision... S&P 500 slightly up, small- and mid-cap stocks strong

Source: BlockMedia Original Title: [New York Stock Market Close] Cautious ahead of Fed rate decision… S&P 500 slightly up, Nvidia +2% Original Link:

New York Stock Market Overview

The New York stock market finished trading flat as it remained cautious ahead of the Federal Reserve’s [image]Fed( December interest rate decision. Investors monitored labor market indicators and corporate earnings, appearing to pause for breath after the recent bullish trend.

) Labor Market Indicators

According to the U.S. Department of Labor, new unemployment claims for the last week of November, seasonally adjusted, totaled 191,000, marking the lowest level since September 2022. This figure is down 27,000 from the previous week, indicating that labor market conditions remain solid.

However, the market believes this figure is likely influenced by seasonal distortions due to the Thanksgiving holiday. Major investment banks warned against over-interpreting the data, stating that “such an unusually large decline has been repeated in similar periods in the past.”

Accordingly, the probability that the Fed will cut the base rate by 0.25 percentage points at the December Federal Open Market Committee (FOMC) meeting next week remains high at 87%.

Major Indexes Mixed

The S&P 500 closed at 6,857.12, up 7.40 points (0.11%) from the previous session. The Nasdaq Composite rose 51.04 points ###0.22%( to 23,505.13.

On the other hand, the Dow Jones Industrial Average fell 31.96 points )0.07%( to close at 47,850.94, a slight decline. The Russell 2000, focusing on small and mid-cap stocks, climbed 19.11 points )0.76%( to 2,531.25, marking a strong two-day winning streak. The “down-cap rotation” phenomenon within the market is becoming more pronounced, and some investors are paying attention to the possibility of expanded year-end momentum for small and mid-cap stocks.

) Individual Stock Trends

Among individual stocks, Meta Platforms surged about 4%, drawing market attention. As the possibility of restructuring in the metaverse division was raised, some investors interpreted this as a catalyst for improved profitability and showed buying interest.

Salesforce also rose more than 3%. Third-quarter revenue exceeded market expectations, and fourth-quarter earnings guidance was raised, boosting investor sentiment. Conversely, Snowflake fell more than 8% due to disappointing results and lowered guidance.

( Technical Outlook

Market strategists noted that a “risk-on” )Risk-on### trend is emerging, with rotation centered on small and mid-cap stocks, industrials, and financials.

The S&P 500 has technically maintained an upward structure, recovering key levels it had previously lost. However, until the Fed’s announcement, heightened volatility and a range-bound (box) trend may repeat.

After the bullish trend at the end of November, the market is running out of momentum ahead of the year-end. Even if a rate cut is confirmed at this FOMC, much of it is already priced in, so the market is expected to move within a narrow range for the time being.

Economic Indicators to Watch

Market participants are watching the September Personal Consumption Expenditures (PCE) and income/spending data, as well as the preliminary December University of Michigan Consumer Sentiment Index. These could offer additional clues for the Fed’s future policy direction.