Dow gains 520 points as US stocks notch their best month this year
New York (CNN) — The Dow reached a new high for the year Thursday as easing inflation data and strong third quarter earnings from Salesforce shot the benchmark index 520 points, or 1.5% higher.
While it was a mixed day for markets overall, all three major indexes managed to make November one of their top-performing months of 2023.
The S&P 500 rose more than 8% this month and the Nasdaq was up about 10%, marking their best month since July 2022. The Dow, meanwhile, managed to shake off a three-month losing streak, also rising by about 8.8% and notching its best month since October 2022.
The Dow was boosted by a 9.4% gain in Salesforce stock. The company saw its stock soar after it reported an earnings beat. But losses from megacap companies like Nvidia and Meta, down 2.9% and 1.5% respectively, weighed down the tech-heavy Nasdaq.
The S&P 500 gained 0.4% for the day while the Nasdaq was down 0.2%.
Investors were also buoyed by news of easing inflation on Thursday.
October’s Personal Consumption Expenditures Index, the Fed’s favored inflation gauge, fell to its lowest level since the spring of 2021. This slowdown in inflation is a positive sign for the markets.
When including gas and food prices, the overall PCE index was unchanged last month. It’s the first time since July 2022 that prices did not rise on a monthly basis.
A surprise drop in euro zone inflation to 2.4% in November also helped investor sentiment on Thursday.
The number of Americans making first-time claims for jobless benefits rose last week to 218,000 from a revised 211,000 the previous week, according to Department of Labor data released Thursday. Rising unemployment is also an indicator that the Federal Reserve might put an end to its current rate hiking regimen.
New York Fed President John Williams said Thursday that policymakers had likely raised interest rates to, or very close to, their peak.
CNN’s Fear and Greed Index, which tracks seven indicators of market sentiment in the United States, sat firmly at “greed” Thursday, where it’s been since November 15. The index spent all of October in “fear” or “extreme fear.”
Oil futures, meanwhile, fell even after Saudi Arabia, the world’s biggest exporter of crude oil, announced that it would extend a voluntary production cut of 1 million barrels per day — previously intended to run till the end of December — by another three months, according to the state-run Saudi Press Agency.
Analysts expect that the stock market’s strong performance will continue through December in a so-called Santa Claus rally.
“Seasonality indicates that the uptrend which started in late October is likely to continue through to the end of the year,” said Cory Mitchell, an analyst with trading education website Trading.biz. While “technology stocks have a more checkered history in December,” he said, “the recent strong performance in stocks signals that the pullback of the prior several months is over and the uptrend is back underway.”
The-CNN-Wire
™ & © 2023 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
