Big Three Indexes Up Again, Dow And S&P Make New All-Time High Closes The big three indexes (Dow, S&P and Nasdaq) all closed higher yesterday. The Dow made another new all-time high and close in the process. The S&P made a new all-time high close. And while the Nasdaq wasn't as lucky, they are within striking distance of doing the same. Stocks got off to an uneven start after it was announced on Monday evening that President-elect Trump would sign executive orders on day one (Jan. 20) of his administration imposing a 25% tariff on all goods coming from Canada and Mexico until they solve their border problems. Not to mention an additional 10% tariff on China until they stem their flow of drugs. Canadian Prime Minister Justin Trudeau said he had "a good call" with Trump since making that announcement. And Mexican President Claudia Sheinbaum said she was open to talking with the incoming administration on these matters. The threat of tariffs should not come as a surprise since they were talked about extensively on the campaign trail, albeit less so directed at Canada and Mexico. Nonetheless, the announcement did catch some by surprise given the new term has not even started yet. But the market appeared to put it into the proper perspective since it's still roughly 8 weeks away. And the tariffs are clearly being used as a negotiating tactic – meaning we could see an agreement made before those tariffs ever get implemented. In other news, yesterday's New Home Sales came in at 610,000 units (annualized) vs. last month's 738K and the consensus for 725K. The Richmond Fed Manufacturing Index was at -14.0, same as last month, but below expectations for -8.0. And Consumer Confidence rose to 111.7 vs. last month's upwardly revised 109.6 (from 108.7), but was just under the consensus for 112.3. Lastly, yesterday's FOMC Minutes showed the Fed leaning toward more interest rate cuts. The Minutes said, "in discussing the outlook for monetary policy, participants anticipated that if the data came in about as expected, with inflation continuing to move down sustainably to 2 percent and the economy remaining near maximum employment, it would likely be appropriate to move gradually toward a more neutral stance of policy over time." The Fed will get another look at inflation this morning with the Personal Consumption Expenditures (PCE) index (the Fed's preferred inflation gauge). The headline rate is expected to be up 0.2% m/m, in line with last month, while the y/y rate is expected to rise to 2.3% vs. last month's 2.1%. The core rate (ex-food & energy) is expected to come in at 0.3% m/m, also in line with expectations, while the y/y rate ticks up to 2.8% vs. last month's 2.7%. In addition to today's PCE index, we'll also get MBA Mortgage Applications, Durable Goods Orders, the second reading of Q3'24 GDP, Weekly Jobless Claims, Retail and Wholesale Inventories, Corporate Profits, the Chicago PMI, the Survey of Business Uncertainty, and the Pending Home Sales Index. Remember, today is the last full trading day this week. The markets will be closed tomorrow for Thanksgiving. And then we have a half day on Friday. It's been an exciting week so far. But not surprising given that stocks typically go up the week of Thanksgiving. This week will soon be over. But gladly, we'll still have another 4+ trading weeks left, which is great news since Q4 is the best quarter for stocks. So make sure you're taking full advantage of it.  Kevin Matras
Executive Vice President, Zacks Investment Research | 
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