Traders work the floor of the New York Stock Exchange.
NYSE
Stocks gained on Wednesday, keeping the major averages on track for their biggest monthly gain in 2023.
The Dow Jones Industrial Average was up about 105 points, or 0.3%. The S&P 500 ticked up by 0.2%, and the Nasdaq Composite rose by 0.1%.
General Motors shares popped about 9.3% after the company announced a $10 billion buyback and raised its dividend, and NetApp soared 15% on an earnings beat. Phillips 66′s stock jumped 3.8% after Elliott Investment Management took a $1 billion stake in the energy company.
The yield on the 10-year Treasury note fell below 4.3% for the first time since September, lending support to stock valuations.
Data released Wednesday showed gross domestic product in the third quarter grew at a stronger-than-forecast annual rate of 5.2%. The boost came primarily from revisions to government spending and investments in nonresidential structures.
“We probably need to digest gains and I would not be surprised if that occurs in the early part of December, which historically we tend to see,” Sam Stovall, chief investment strategist at CFRA Research, said. “But at the same time, December is, historically, the best month of the year in terms of a batting average, meaning frequency of advance. So I wouldn’t be surprised that we continue to have a positive move in the markets between now and the end of the year.”
According to Adam Turnquist, chief technical strategist at LPL Financial, the S&P 500 could reach 4,600 by the end of this year.
“Our market right now is just looking at the longer term trend in inflation and obviously it’s coming down — the Fed is acknowledging that. I think the scope for a Santa Claus rally is growing,” Turnquist said. “We’re not extremely overbought. I think there’s more room for participation in the rally.
Traders have been optimistic that the Fed’s rate-hiking cycle is over, with fed funds futures pricing reflecting a chance the central bank could cut rates as early as next spring.
However, Richmond Fed President Thomas Barkin said Wednesday that policymakers could keep rate increases on the table if inflation doesn’t continue to slow.
The major averages are on track for strong monthly gains. The S&P 500 and Dow are up 8.8% and 7.3%, respectively, in November. The Nasdaq has climbed 11.3% over the same period.
