Market Update

DOW 47,574 (-165), S&P 500 6,849 (+3), Russell 2000 2,535 (+14), NYSE FANG+ 16,621 (+31), ICE Brent Crude $61.90/barrel (-$0.59), Gold $4,235/oz (+$18), Bitcoin ~94.0k (+2662)

• The holding pattern continues 
• Economic data better than feared
• Small caps outperform
• Powell is stretching out
• Check out some of the recent ICE Data/Content:
• Inside The ICE House
  • Episode 502: Author & Entrepreneur Brad Feld on Mentorship, Leadership, & Building Better Ecosystems
  • ICE Mortgage Monitor: Mortgage Refinance Retention Hits Multi-year High as Falling Rates Spur Activity Among Recently Originated Loans
  • ETF Central: Former CNBC Senior Markets Correspondent Bob Pisani
  • Market Story Lines

MAC Desk Commentary:
Yesterday equities pulled back modestly but really it was just a continuation of the consolidation that has been ongoing for the last week and change. Ahead of tomorrow’s rate decision the holding pattern is continuing. There was a positive bias early on but that has faded as financials have turned lower following commentary at the Goldman Sachs Financial Services conference. There is a fair amount of news flow but none that is really shifting the overall narrative. The administration approved Nvidia exporting its H200 chips to China (with the US government collecting 25% of sales), but the local response has been closer to keep ‘em with regulators discussing restrictions. Broadly this morning’s economic data came in better than feared but none is important enough to shift expectations for monetary policy. Corporate updates have been a bit mixed. Major indices are mixed trading continuing to consolidate in a tight range. As we head to print, the S&P 500 is up 3pts to 6,849 (+0.0%), the Dow is down 155pts to 47,584 (-0.3%), while the Russell 2k is up 14pts to 2,535 (+0.5%). The most interesting action is happening in the crypto complex which started to rally sharply after the open. Bitcoin reclaimed its declining 20d ma (91.5k) and has continued to squeeze higher since now up ~3% at ~94k. If this can hold above that moving average it would be the first close above since the infamous flash crash selloff on October 10^th. Other altcoins are up even more sharply with Ethereum and Solana currently up >6%.



Looking at the economic data. The NFIB Small Business Optimism Index rose 0.8 points in November, to 99.0. Sales expectations and employment plans saw the largest increases, while economic outlook, capex plans and credit expectations saw declines. The weekly ADP employment report had 4.75K jobs/week added during the four weeks ending November 22. This was better than the last weekly report on 11/25 that showed a decline of 13.5k/week, and also an improvement from the Monthly report on 12/3 showing a loss of 32k jobs in November. The October JOLTS job openings unexpectedly jumped to 7.67ml from 7.227ml. Layoffs and discharges ticked up very slightly to 1.2% but remains at historically low levels. Treasury yields ticked up a couple of basis points on the release.

• US 2yr +3bps to 3.61%, 5yr +2bps to 3.78%, 10yr +2bps to 4.18%, 30yr +0bps to 4.81%
• USD index: +$0.19 to $99.25

Global markets were mixed overnight. Japan finished slightly higher. Finance Minister Katayama switched her commentary from the yen to JGB yields, saying she is closely monitoring yield levels with the 10y near 2%. The Nikkei reported Japanese companies issued a record amount of foreign-currency bonds this year and are on track to issue more than yen-denominated bonds. Indices in China closed lower with the Hang Seng falling >1% for the second consecutive day with tech names under some pressure on the heels of the Nvidia news. Australia maintained its policy rate at 3.6% as expected though some of the commentary was viewed as hawkish. European markets were mixed with Germany leading while France was under some pressure.



The commodities complex is also mixed. Oil is pulling back ~1% as markets continue to focus on Ukraine and Venezuela. Exxon Mobil (+2.5%) had its investor day today. The company kept its capex estimates unchanged while FCF, earnings and PXD synergies were all increased. US natural gas prices are down >4% for the second consecutive day. Precious metals are on the move higher with silver leading to the upside up >4% breaking above $60. However, copper is down >2%. Ag is mixed after the WASDE report was released.



Within the S&P 500 8 of 11 sectors are trading higher. Energy is outperforming with Exxon doing much of the heavy lifting. Consumer discretionary is up ~0.6% the mega-cap components and travel related stocks are offsetting losses in the housing related names after some cautious commentary.  Most other sectors are +/-<0.5%. Financials have given up early gains after JP Morgan commentary at the Goldman Sachs Financials Services conference. Community banking CEO Marianne Lake warned that the consumer environment was a “bit more fragile”. Healthcare is the worst performing sector down ~0.5% however, CVS is trading up ~3% after updating long term guidance at its analyst day today and Teleflex is up >10% after announcing the sale of a couple of businesses for ~$2B half of which will be used for share repurchases.
 



The big event for tomorrow is the FOMC policy decision where a 25bps cut is widely expected. However, markets expect there to be multiple dissents and for the rate cut to be accompanied by some hawkish commentary suggesting that the bar for further policy easing is higher. Along with the rate decision the Summary of Economic Projections will also be updated for the first time since September and investors will comb over this looking for clues about the path of policy going forward. The last DOT plot highlighted the varying views on the Committee which have since been vocalized. The median DOT for 2026 pointed to 1 additional rate cut in 2026. At this point futures are pointing to a ~40% of a rate cut by the end of Q1 so market expectations seem reasonably aligned.
 
The other big catalysts come from AI with the release of GPT-5.2 expected imminently and Oracle earnings after the close. The economic data includes China inflation data overnight and Q3 ECI ahead of the open.

Economic Data:
US:

• Weekly ADP employment: 4.75K vs. prior -13.5K
• NFIB Small Business Survey: 99.0 vs. cons. 98.4, prior 98.2
• JOLTS: 7.67ml vs. 7.1ml, prior 7.227ml

Global:

• Australia rate decision: Maintain at 3.6% as expected
• Japan Machine Tool Orders y.y: 14.2% vs. prior 16.8%
• Taiwan Exports y.y: 56% vs. 41.1% cons., prior 49.7%
• Germany Trade Balance (Oct): €16.9B vs. €15.2B cons., prior €15.3B
  • Exports m.m: 0.1% vs. -0.2% cons., prior 1.5%
  • Imports: -1.2% vs. 0.2% cons., prior 3.1%