“Today and the half day on Friday are fairly light days from a trading perspective and it’s a pattern you normally see around holidays like Thanksgiving where volume is shorter and there’s a little more optimism among retail investors,” said Chuck Carlson, CEO of Horizon Investment Services in Hammond, Indiana.“The other factor is that Wall Street has moved back quite a bit in recent days toward the idea that the Fed is going to cut rates in December,” Carlson added. “And I think this is probably the biggest boost for the market, not just for today, but for the last few days.”
A Reuters poll found that analysts on average expect the S&P 500 to rise 12% between now and the end of 2026, driven by a robust economy, continued strength from the technology sector and an accommodative Fed.
The Fed’s Beige Book, which summarizes economic conditions by district, appeared to have little to no effect on expectations for rate cuts. Financial markets currently estimate an 84.9% probability that the central bank will implement a 25 basis point cut to its key Fed funds target rate at the end of the December policy meeting, according to CME’s FedWatch tool. Airlines were trading sharply higher on what is traditionally the busiest travel day of the year for commercial carriers. The S&P 1500 Airlines index rose 3.0%. Air traffic is often seen as a barometer of consumer health, which bodes well for the holiday shopping season, which begins on Thanksgiving and is followed by Black Friday and Cyber Monday. This period is crucial for U.S. retailers as they woo shoppers and deal with squeezed profit margins and a wave of corporate layoffs. Although the National Retail Federation predicts that holiday sales will surpass $1 trillion for the first time in 2025, forecasts from discount retailers like Walmart and Target are mixed. Economic data showed that orders for core capital goods exceeded consensus in September. While the Commerce Department report is outdated due to government shutdown delays, it suggests business spending is more robust than economists had forecast. On the other hand, while initial unemployment insurance claims ended up below consensus, ongoing claims continue to trend upward, supporting recent survey data showing consumer judgments about the labor market are deteriorating. The Dow Jones Industrial Average rose 314.67 points, or 0.67%, to 47,427.12, the S&P 500 gained 46.73 points, or 0.69%, to 6,812.61 and the Nasdaq Composite gained 189.10 points, or 0.82%, to 23,214.69.
Of the eleven major sectors in the S&P 500, utilities were the biggest percentage gainers, while communications services saw the biggest declines. Dell Technologies rose 5.8% on better-than-expected earnings and optimistic forecasts. Human resources software company Workday fell 7.9% after the company reported third-quarter subscription revenue in line with estimates. Deere’s weaker-than-expected annual profit forecast, which was weighed down by tariff effects, sent the heavy machinery maker’s shares down 5.7%.
On the NYSE, advancing issues outnumbered declining issues by a ratio of 3.37 to 1. There were 290 new highs and 29 new lows on the NYSE.
On the Nasdaq, 3,183 stocks rose and 1,492 fell as advancing issues outnumbered declining stocks by a 2.13-to-1 ratio.
The S&P 500 recorded 34 new highs over the past 52 weeks and no new lows, while the Nasdaq Composite recorded 133 new highs and 48 new lows.
Volume on U.S. exchanges was 14.78 billion shares, compared to the full-session average of 19.49 billion over the past 20 trading days.
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