Stock Market Update

[BRIEFING.COM] Stocks are mostly higher today as the market relishes in a newfound sense of ease after yesterday's de-escalation of geopolitical tensions. The S&P 500 (+0.8%), Nasdaq Composite (+1.0%), and DJIA (+1.2%) have expanded upon yesterday's gains, steadily trading higher throughout the session. 

Nine S&P 500 sectors trade higher, with just the real estate (-0.2%) and energy (-0.2%) sectors holding slight losses. 

The communication services sector (+1.7%) sits atop the leaderboard as Meta Platforms (META 644.82, +31.86, +5.20%) and Alphabet (GOOG 332.06, +3.68, +1.12%) provide solid leadership that overshadows a continuation of post-earnings weakness in Netflix (NFLX 83.40, -1.96, -2.30%). 

Mega-cap strength also keeps the information technology (+1.0%) and consumer discretionary (+1.0%) sectors near the top of the leaderboard. The Vanguard mega-cap growth ETF is up 1.0% as the market's largest names garner some buy-the-dip interest after considerable weakness in Tuesday's session. 

Elsewhere in the technology sector, software names such as Arista Networks (ANET 138.51, +11.22, +8.81%) and Datadog (DDOG 131.97, +8.51, +6.89%) are posting solid gains that send the iShares GS Software ETF 1.3% higher. 

Chipmakers are advancing as well (the PHLX Semiconductor Index is up 0.6%), though not at the same pace as yesterday's advance. 

In fact, most corners of the market are advancing in a steadier fashion following a volatile session yesterday. Stocks wavered from their opening gains but have largely climbed at a deliberate pace since around 10:00 am. 

The CBOE Volatility Index is down 8.9% to 15.40.

This morning's delayed release of the November Personal Income and Spending Report showed that Core PCE Inflation remained relatively steady on a year-over-year basis at 2.8%, which adds to the sense of calm as it should not alter the Fed's policy outlook. 

In addition to the data, the market received another batch of earnings reports, which included a handful of notable moves.  Procter & Gamble (PG 149.82, +3.76, +2.57%) moves higher after a slight EPS beat, while GE Aerospace (GE 301.20, -17.30, -5.43%) faces some sell-the-news pressure after a solid report, and Abbott Labs (ABT 110.50, -10.23, -8.47%) moves sharply lower after disappointing near-term guidance. 

Outside of the S&P 500, the Russell 2000 (+1.3%) outperforms yet again, expanding this year's gain to 10.1%. The S&P Mid Cap 400 (+0.5%) holds a more modest gain. 

So far, the market has done a solid job of maintaining yesterday's relief rally, with broadening leadership and solid breadth underscoring improved sentiment that looks to move the major averages back into positive territory for the year.

Reviewing today's data:

• Weekly Initial Claims 200K (Briefing.com consensus 200K); Prior was revised to 199K from 198K, Weekly Continuing Claims 1.849 mln; Prior was revised to 1.875 mln from 1.884 mln
  • The key takeaway from the report is that the low level of initial jobless claims substantiates the view that the labor market is still operating in a low-firing environment, which is supportive for consumer spending activity and the growth outlook.
• Q3 GDP - Revised 4.4% (Briefing.com consensus 4.3%); Prior 4.3%, Q3 GDP Deflator - Revised 3.8% (Briefing.com consensus 3.7%); Prior 3.8%
  • The key takeaway from the report is that it is a dated and little-changed report, so its market-moving capacity is nil; however, it is a headline reminder that the economy was running on the hotter side of things in the third quarter.
• October Personal Income 0.1% (Briefing.com consensus 0.3%); Prior 0.4%
• October Personal Spending 0.5% (Briefing.com consensus 0.1%); Prior 0.4%
• October PCE Price Index 0.2% (Briefing.com consensus 0.2%); Prior 0.3%
• October Core PCE Price Index 0.2% (Briefing.com consensus 0.2%); Prior 0.2%
• November Personal Income 0.3% (Briefing.com consensus 0.4%); Prior 0.1%, November Personal Spending 0.5% (Briefing.com consensus 0.4%), November PCE Price Index 0.2% (Briefing.com consensus 0.2%); Prior 0.2%, November Core PCE Price Index 0.2% (Briefing.com consensus 0.2%); Prior 0.2%
  • The key takeaway from the report is that the core PCE Price Index, which is the Fed's preferred inflation gauge, was at 2.8% in November, essentially unchanged from September. As a result, this report should not alter the Fed's outlook since the inflation picture remains largely unchanged.