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The week before the Thanksgiving holiday offered up some encouraging news for those looking for an end to interest rate hikes. On Tuesday, CPI data was released and showed that inflation on an annual basis dropped to 3.2 percent in October from 3.7 percent in September. It also showed that inflation on a monthly basis stayed flat in October compared to September. Core inflation was up .2 percent compared to .3 percent in the previous report. Core CPI refers to the inflation rate when not accounting for volatile items such as food and energy prices.

On Wednesday, it was revealed that the Price Producers Index (PPI) figure was -.5 percent for the month of October. Core PPI was flat for the month, which was the first time that prices minus food and energy costs failed to go up since April. Core retail sales were up .1 percent compared to .8 percent in September, which is another sign of a slowdown in consumer demand that Jerome Powell believes is likely necessary to keep inflation closer to 2 percent.

Also on Wednesday, the Empire State Manufacturing Index came out, which showed an uptick in production in that sector over the past month. The final figure was 9.1, which was significantly higher than the -3.3 forecast by analysts. It was also higher than the -4.6 recorded last month.

On Thursday, unemployment claims for the week were released, and over the past seven days, there were 231,000 requests for benefits. This was an increase of about 13,000 over the previous week and was about 10,000 more than analysts expected prior to the report’s release.

Friday saw the release of building permit data in the United States, and there were 1.49 million permits issued in the previous month. This was up from 1.47 million from October’s report, and it could have a minor impact on buyers as an increase in supply helps to ease the pressure on housing prices.

The Dow 30 was up 1.99 percent this week to close at 34,974. It started the week at its lowest point of 34,236 before surging on Tuesday to 34,913. It would then spend the rest of the week in a narrow range between Tuesday’s high and Friday’s close, which was also the high of the week for this market.

The Nasdaq would finish the week up 2.79 percent to close at 14,125. As with the Dow, the Nasdaq started the week at its lowest point, made a big move on Tuesday and then spent the final three trading days in a narrow range. Specifically, the Nasdaq made a low of 13,690 on Monday and a high of 14,186 on Wednesday.

Finally, the S&P 500 would make a gain of 2.43 percent this week to finish at 4,514. Like the other two major equity markets, the S&P 500 would make a low on Monday, make a significant gain on Tuesday and then level off for the rest of the week. The weekly low was 4,398 on Monday while the weekly high was 4,515 on Wednesday.

Oil would have an up-and-down week as it was as high as $80 a barrel on Monday before plummeting to roughly $73 a barrel by Thursday. It would then rebound on Friday to finish at $76.62. However, it is still down about $18 per barrel from its high of $94 in late September.

The upcoming week will feature a condensed schedule in the United States because of the Thanksgiving holiday. Markets will largely function as normal on Monday, Tuesday and Wednesday before closing entirely on Thursday and by 1 p.m. on Friday. Unemployment claims data will be released on Wednesday instead of Thursday while FOMC meeting minutes will be released on Tuesday instead of Wednesday. The University of Michigan’s consumer sentiment and inflation expectations reports will also be released on Wednesday instead of Friday.

Friday morning also sees the release of Flash Manufacturing Services PMI and Manufacturing PMI data. Inflation, employment and other important news releases are also expected to be released in Canada, Australia and the United Kingdom throughout the week. Analysts expect these reports to show that inflation is stabilizing throughout the world, which could have an impact on the Fed’s upcoming December rate decision.

The first full week of November was a relatively quiet one with only a couple of major news releases on the calendar. However, it was not without intrigue as some members of the Fed said that interest rates could continue to rise if inflation remained a problem that couldn’t be solved by other means.

On Wednesday morning, Jerome Powell said that the Fed needed to be flexible in its approach and rely on common sense as much as it relies on data. He cautioned that the economy is dynamic and that economic shocks can happen without warning that may make it necessary to raise or lower rates accordingly.

During another speech on Thursday afternoon, he said that the Fed was not ready to say that the United States had reached its peak interest rate. The Fed Funds rate is currently in a range between 5.25 percent and 5.5 percent, which is the highest it has been in more than two decades.

Powell then seemed to hedge his bets by also mentioning that improvements in the supply side could help to tame wage and price increases. Most are still in agreement that interest rates will remain where they are for quite some time, which could mean most or all of 2024. Last month, it was revealed that the inflation rate in the United States was 3.7 percent, which is still significantly higher than the 2 percent target rate. However, it is significantly lower than the 9.1 percent in July of 2022.

On Thursday, unemployment claim data was released and revealed that 220,000 people had filed for benefits, which was up from 218,000 a week ago. On Friday, the University of Michigan released its preliminary consumer sentiment and inflation expectation figures. Consumer sentiment was at 60.4 percent, which was down from 63.8 percent a month ago. Analysts had expected the preliminary number to be 63.7 percent. In addition, consumers expect that the inflation rate will be 4.4 percent a year from now, which is up from 4.2 percent a month ago.

The Dow would finish the week up 183 points to finish at 34,283. It would spend the majority of the week in the red before a strong Friday saw the market gain 391 points to allow it to finish in positive territory. The market made a weekly low of 33,873 on Thursday before reversing and closing at a peak of the week.

The Nasdaq also finished the week higher thanks to a strong performance on Friday. For the week, the Nasdaq was up 2 percent to close at 13,798, and almost all of that was thanks to a 276-point gain on the closing day of the week. On Monday, the Nasdaq made its low for the week at 13,490 before reversing and staying in a trading range until Friday.

Finally, the S&P 500 was up 1.15 percent this week to close at 4,415. As with the other two major indices, the S&P 500 finished in the green thanks to a strong close on Friday that saw the market gain 1.56 percent or 67.89 points. The S&P 500 hit its low of the week on Thursday at 4,347 before reversing and moving higher. Prior to Thursday and Friday’s strong move, the market spent most of the week in a narrow range.

Oil prices continued their decline that began in October this week as West Texas Intermediate (WTI) fell to about $78 compared to almost $90 just a few weeks ago. Prices dipped to as low as $75 during overnight trading on Friday before rebounding. This has been largely the opposite of what some had expected at the outset of the conflict between Hamas and Israel.

There will a number of significant news announcements coming up this week as CPI, PPI and retail sales figures are set to be released. Analysts are expecting inflation to have eased to 3.3 percent on an annualized basis while prices are expected to have risen .1 percent. Analysts also expect that retail sales will shrink by .2 percent, which would likely have some effect on inflation figures going forward. In addition, inflation and employment reports are also going to be released in Australia and Great Britain, which could influence policy in the United States.

The last few trading days were full of intensity as both a Fed interest rate decision and a nonfarm payroll (NFP) report were released. However, the first major news releases of the week came on Tuesday when the Employment Cost Index (ECI) for the previous quarter was made public and revealed that labor costs for civilian and government employers was up 1.1 percent compared to the previous three months.

This was slightly above analyst estimates of a 1 percent rise, which would have matched the 1 percent rise seen in the second quarter. Also on Tuesday, the Consumer Board (CB) issued its consumer confidence figures, which came in at 102.6 compared to a prediction of 100.5.

On Wednesday, the ISM Manufacturing PMI was released and came in at 46.7 percent, indicating a slight contraction in the manufacturing sector. Analysts had expected the report to come in at 49 percent prior to the report’s release. The Job Openings and Labor Turnover Survey (JOLTS) report also came out on Wednesday morning, and it found that there were 9.55 million open positions in the United States. This was slightly higher than the revised figure of 9.5 million openings in October.

The final report on Wednesday prior to the Fed’s rate decision was the ADP nonfarm employment change report. It found that employers added 113.000 jobs in the past month, which was well below the 149,000 figure expected prior to the release.

At 2 p.m., the Federal Open Market Committee (FOMC) issued its rate decision for November, and as most expected, rates were held steady at a range of 5.25 percent to 5.5 percent. However, Fed Chair Jerome Powell warned that rates could still go up if inflationary pressures failed to ease in a timely manner. However, most observers expect that the Fed is nearly done raising rates. It is worth noting that the Fed has come out and said that rates are unlikely to come down anytime soon.

On Thursday, it was revealed that 217,000 people filed for unemployment benefits, which was slightly higher than the 212,000 who filed last week. On its own, the release may not be cause for concern, but when taken together with data released Friday, it may foretell of an economic slowdown.

Friday morning saw the release of the NFP from the Bureau of Labor Statistics (BLS), and it revealed that 155,000 jobs had been created in the past month. It also found that the unemployment rate had ticked up to 3.9 percent while average hourly earnings ticked up .2 percent in October.

Equity markets experienced a significant amount of volatility as the various major news reports were released. For starters, the S&P 500 was up 4.62 percent this week to finish at 4,358. It would open the week at 4,165 before dipping slightly to 4,154 on Monday morning. However, it would spend the rest of the week trending higher until reaching its weekly high of 4,372 on Friday afternoon.

The Dow was up 3.68 percent to finish the week at 34,061. As with the S&P, the Dow would make its weekly low of 32,793 on Monday morning before spending the rest of the week gaining ground. On Friday, the market hit its weekly high of 34,162 before easing back to its closing price.

Finally, the Nasdaq would be the most prosperous index of the week as it gained 5.7 percent to finish at 13,478. As with the other major indices, the Nasdaq would dip slightly on Monday to reach its weekly low of 12,712 before trending higher each day after that.

After one of the most eventful trading weeks in recent memory, the upcoming week is rather sparse on major news releases. On Thursday morning, Jerome Powell is expected to speak, which always provides the potential to inject volatility into the market. On Friday morning, the University of Michigan will release its preliminary consumer sentiment and inflation expectations reports. Those who follow international markets may be interested to know that Bank of Japan (BOJ) Governor Ueda is expected to speak on Monday while interest rate decisions will be forthcoming in Australia and China.