Stocks ended in record territory Monday as markets reacted to President-elect Donald Trump's choice for treasury secretary ahead of a holiday-shortened week.
The Dow Jones Industrial Average gained 440.06 points, or 0.99%, to end the session at fresh record high of 44,736.57, while the S&P 500 reached a record close of its own, rising 0.30% to finished the day at 5,987.37.
The tech-heavy Nasdaq added 0.27% to close at 19,054.84.
The Russell 2000, the market's benchmark index of small and medium-sized U.S. companies, also posted a fresh record high.
Investors were reacting to President-elect Trump's selection of Scott Bessent as Treasury Secretary
Bessent, 62, has worked with some of the most renowned investors in the world, including Jim Rogers, Jim Chanos, Stanley Druckenmiller and George Soros, according to CNN.
Updated at 1:10 PM EST
Auction blowout
A $69 billion auction of new 2-year Treasury notes drew solid demand as bond markets extended their solid Monday rally following President-elect Trump's selection of Scott Bessent as Treasury Secretary.
Investors placed bids worth $191.1 billion for the paper on offer, generation a so-called bid-to-cover, or demand ratio, of 2.77. That was well ahead of the 2.5 ratio recorded at last month's sale.
Foreign central banks, meanwhile, took down around 71.6% of the sale, a massive increase from the October auction tally of 58.2%.
⚠ U.S. SELLS $69 BLN 2-YEAR NOTES AT HIGH YIELD 4.274%, AWARDS 34.70% OF BIDS AT HIGH
— PiQ (@PiQSuite) November 25, 2024
**U.S. 2-YEAR NOTES BID-TO-COVER RATIO 2.77, NON-COMP BIDS $616.16 MLN
**PRIMARY DEALERS TAKE 9.2% OF U.S. 2-YEAR NOTES SALE, DIRECT 19.17% AND INDIRECT 71.63%
**PRIMARY DEALER ACCEPTED…
Updated at 12:18 PM EST
Biggie small caps
The Russell 2000, the market's benchmark index of small and medium-sized U.S. companies, hit a fresh all time high Monday amid the ongoing rally in domestic assets tied to the incoming Trump administration.
The Russell, which has outpaced gains for each of the three major benchmarks this month and is up 10.6% since Election Day, hit a fresh all-time peak of 2,466.49 points earlier in the session.
Strength begets more strength.
— Caleb Franzen (@CalebFranzen) November 25, 2024
New all-time highs beget more ATH's.
It's not rocket science... it's just an uptrend.
When the Russell 2000 $RUT makes new ATH's, more new highs typically follow.
The small cap index is making new all-time highs today. pic.twitter.com/wAv09YP3ot
Updated at 10:09 AM EST
Inversion 2.0
Bond markets extended their overnight rally in the wake of President-elect Trump's nomination of Scott Bessent as Treasury Secretary, with 2-year notes falling below 10-year notes for the first time since early autumn.
Benchmark 2-year notes were pegged at 4.301%, down 5 basis points from overnight levels, with 10-year paper trading at 4.293%.
"Bessent will, in fact, be invaluable to Trump as he navigates his way through the very tricky business of global trade and its impacts on interest rates, currency strength, inflation… and ultimately, your pocketbook," said Mark Malek, chief investment officer at Siebert.
"Now, it is important to remember that Bessent is a speculator and has been for almost his entire career on Wall Street," he added. "The bad thing is that the US economy is not something to be trifled with, but the good thing is that Bessent spent his entire career learning how to assess risks and returns, something most politicians have very little care or understanding of."
We almost inverted the yield curve (10s and 2s) again!
— Fibonacci Investing⚡️ (@FibonacciInves1) November 25, 2024
This is getting spicy 🌶️!!#bonds $SPY pic.twitter.com/mZ1bjLHBiL
Updated at 9:39 AM EST
Record Dow
The S&P 5000 was marked 44 points, or 0.75% higher in the opening minutes of trading, with the Nasdaq rising 154 points, or 0.82%
The Dow, meanwhile leaped 496 points and printed a fresh all-time high of 44,792.96 points while the mid-cap Russell 2000 gained 38 points, or 1.6%.
S&P 500 Opening Bell Heatmap (Nov. 25, 2024)$SPY +0.57%🟩$QQQ +0.61%🟩$DJI +0.81%🟩$IWM +1.53%🟩 pic.twitter.com/811o5l0oQH
— Wall St Engine (@wallstengine) November 25, 2024
Updated at 8:05 AM EST
Busy week
Investors will navigate a relatively hectic calendar of economic data releases over the next three days, including a key inflation reading that could alter bets on the Fed's December rate decision.
Minutes of the Fed's November meeting will be published Tuesday, with the Bureau of Economic Analysis' PCE inflation report, as well as the second estimate of third quarter GDP growth and weekly jobless claims figures, set for the following day.
Traders will also work through two benchmark Treasury bond auctions this week, including a $69 billion sale of 2-year notes later this afternoon.
Even though this is a short week, Fed inflation [the PCE Price Index], FOMC minutes, and revised GDP have the potential to shape near-term momentum," said Chris Larkin, managing director for trading and investing at E*Trade from Morgan Stanley.
"Longer term, the question is how much optimism may already be baked into the market," he added. "Unless there’s a big sell-off this week, the S&P 500 will log its 11th up month of the past 13, and it’s gained more than 42% over that span. Since 1957, only 12 other 13-month rallies have been bigger than that."
GS forecasts:
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) November 24, 2024
Headline PCE at +0.25% MoM (+2.32% YoY)
Core PCE at +0.27% MoM (+2.79% YoY) pic.twitter.com/qtVQn4Ra5Q
Updated at 7:15 AM EST
Rain on the parade
Macy's (M) shares tumbled in early trading after the retailer said it would delay filing its third-quarter earnings report amid an investigation into potential employee fraud in its accounting unit.
Macy's said the employee hid between $132 million and $154 million in delivery expenses over the past three years, prompting the delay in filing as it investigates. The group also said net sales fell 2.4% over the third quarter to $4.74 billion.
Macy's shares were marked 6.2% lower in premarket trading to indicate an opening bell price of $15.30.
How is it possible that one $M Macy's employee hid $132 million to $154 million of delivery expenses??? pic.twitter.com/LUpDLXpGbn
— Special Situations 🌐 Research Newsletter (Jay) (@SpecialSitsNews) November 25, 2024
Stock Market Today
President-elect Trump nominated Scott Bessent to serve as treasury secretary over the weekend, a billionaire hedge fund manager who is both respected on Wall Street and seen as a potential offset to some of Trump's harsher economic policies.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.6% lower in the overnight session, its biggest decline in two weeks. It was trading at 106.92 on bets that Bessent would act as a break on budget expansion.
Benchmark 10-year Treasury note yields were also lower as bonds reversed some of their inflation-inspired selloff, falling 6 basis points to 4.345%.
"Bessent is known as a fiscal hawk who has advised Trump to create a “3-3-3" policy, including cutting the budget deficit by 3% of GDP by 2028, pushing GDP growth to 3% via deregulation and pumping an extra 3 million barrels of oil each day," Saxo Bank strategists wrote Monday. "He has also expressed that tariffs should be used more as a negotiating tool and implemented more gradually."
Wall Street's early reaction has been positive, with stock futures suggesting a solid open across the board heading into the Thanksgiving week.
Futures contracts tied to the S&P 500, which ended last week 1.68% higher to take its November gain to 4.63%, suggest a 32-point opening-bell gain while those linked to the Dow Jones Industrial Average are priced for a 315-point advance.
Related: Goldman Sachs analyst sees starting point for year-end S&P 500 rally
The tech-focused Nasdaq, which gained 1.73% to boost its November gain to 5.02%, is called 135 points higher with Nvidia (NVDA) , Tesla (TSLA) and MicroStrategy (MSTR) shares active in premarket trading.
In overseas markets, European stocks were modestly higher in midday Frankfurt trading, with the Stoxx 600 rising 0.07% higher and Britain's FTSE 100 gaining 0.13% in London.
More Wall Street Analysts:
- Walmart analysts reset stock price targets ahead of Black Friday
- Analysts revamp Cisco stock price targets after earnings
- Analysts revisit Applied Materials stock price targets after Q4 earnings
Overnight in Asia, Japan's Nikkei 225 gained 1.3% in a follow-up to last week's rally on Wall Street, while the regional MSCI ex-Japan benchmark gained 0.57% into the close of trading.
Related: Veteran fund manager sees world of pain coming for stocks
