U.S. stocks appeared poised for a mixed start in the penultimate session of the year, as major averages sought to reach new highs. Opinions are divided on the sustainability of the rally. Analysts adopting a cautious stance point to the potential for a growth slowdown and a profit recession. In contrast, bullish analysts envision potential Federal Reserve rate cuts as a catalyst to bolster the 2023 rally.
The S&P 500 Index is less than 15 points away from achieving an all-time high, and the Dow Industrials have already reached a record high. Despite overbought levels, sentiment may remain guarded as traders await cues from the weekly jobless claims.
Cues From Wednesday’s Trading:
Wednesday saw the market move without any significant catalysts, yet upward momentum contributed to positive closes for the Nasdaq Composite and the S&P 500 Index, marking their fourth consecutive session of gains. The Dow Industrials also reentered record territory at the close.
The majority of S&P sector classes ended the session in positive territory, except energy, communication services, and utility stocks.
US Index Performance On Wednesday
| Index | Performance (+/-) | Value |
| Nasdaq Composite | +0.16% | 15,099.18 |
| S&P 500 Index | +0.14% | 4,781.58 |
| Dow Industrials | +0.30% | 37,656.52 |
| Russell 2000 | +0.34% | 2,066.21 |
Analyst Color:
”Strong market performance this year has left investors with lofty expectations for 2024. Here’s why they may need to proceed with caution,” said Morgan Stanley’s Lisa Shalett. The analyst cautioned of a slowing economy and possible recession that will likely pressure corporate profits and weigh on asset prices.
”In this environment, consider investing in securities that offer yield and companies with quality cashflows and realistic earnings goals,” she said.
Not all are guarded in their outlook. Jessica Inskip, Director of Product, at OptionsPlay, said in CNBC’s Last Call on Wednesday that she is bullish on 2024. “Consolidation may be on the horizon…2023 was about the Mag 7, 2024 is about broader participation,” she said.
Futures Today
Futures Performance On Thursday
| Futures | Performance (+/-) |
| Nasdaq 100 | +0.30% |
| S&P 500 | +0.10% |
| Dow | -0.10% |
| R2K | -0.28% |
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