Wall Street finds footing as Powell dampens rate cut bets

After their November surge, stocks begin December strongly. After a record-breaking month, US stocks increased on Friday as investors processed comments made by Federal Reserve Chair Jerome Powell, who cautioned against drawing the premature conclusion that rate hikes by the Fed are done or speculating about when cuts might take place.

The Dow Jones Industrial Average gained more than 200 points, or roughly 0.7%, while the S&P 500 gained about 0.5%. The tech-focused Nasdaq Composite saw a 0.4% increase.

Stocks soared in November to post their best monthly performance since 2022 as conviction that the Fed was done with rate hikes morphed into growing hopes for rate cuts before the summer.

It is one of the best months traders have seen in the last decade. It shows how a lot of investors were caught off guard by the Fed’s flexible stance after the November 1 meeting.

Given that, the focus will be firmly on what Powell has to say on policy at his two appearances Friday, especially after October data showed inflation cooled to its lowest levels since 2021. Hopes are he may give a clear steer on the central bank’s thinking after a stream of Fed speakers took differing stances.

Meanwhile, oil prices steadied, having lost ground after OPEC+’s additional output curbs failed to convince skeptical investors. WTI crude futures (CL=F) were trading around $76 a barrel, while Brent (BZ=F) futures were below $83.

Wall Street gathered momentum on Friday afternoon following remarks from Fed Chair Jerome Powell in which he chilled hopes of an imminent rate cut and an end to the tightening campaign.

The S&P 500 increased about 0.5%, while the Dow Jones Industrial Average (^DJI) rose roughly 0.7% or more than 200 points. The tech-heavy Nasdaq Composite advanced 0.4%.

Tesla’s much-anticipated Cybertruck has arrived as the company delivered its first batch of the vehicle to buyers. On first blush the market did not seem impressed, shares of the all-electric automaker fell 2% in morning trading Friday.

The slide also comes after CEO Elon Musk faces the fallout from his interview at the New York Times DealBook conference earlier this week, in which he cursed advertisers fleeing his social media company X.

Drivers interested in the Cybertruck base model will have to hand over $60,990, more than 50% costlier than the company estimated years ago when they announced the new model. “That just isn’t a large segment of the population that can afford that especially where interest rates are,” said Jessica Caldwell, head of insights at auto research firm Edmunds.

The truck’s launch caps off a topsy-turvy year for Tesla, Yahoo Finance’s Josh Schafer reports, which has seen its stock price soar on the possibilities of its artificial intelligence goals while also coming under pressure amid multiple price cuts and weakening margins.

Pfizer shares of the pharmaceutical giant fell by 6% on Friday morning after the company said it would not move forward with a study of its two-dose obesity treatment, following a high level of side effects in patients involved in the trials.
Ulta continued its climb Friday morning, rising more than 12%, after the company reported third quarter results that were slightly better than Wall Street expected. The beauty retailer reported adjusted earnings of $5.07 per share, compared to expected $5.00.

Marvell shares dropped by 6% after the semiconductor company offered fourth quarter guidance that fell short of the expectations for the top and bottom lines.

Wall Street rang in the final month of the day with some pessimism as investors braced for Fed Chair Jerome Powell to deliver remarks later this morning.

The S&P 500 (^GSPC) edged lower by about 0.2%, while the Dow Jones Industrial Average (^DJI) was virtually unchanged. The tech-heavy Nasdaq Composite (^IXIC) sank 0.3%.