Holiday-Shortened Week Begins with Losses…..

U.S. equities began the holiday-shortened week on a down note, as uncertainty regarding the ultimate impact of the omicron variant persists. All the major sectors were in the red, led by Financials, Consumer Discretionary and Information Technology, while Health Care issues were also lower despite Moderna’s announcement of positive results of its COVID booster against omicron. The markets also grappled with dampened expectations regarding the passing of President Biden’s social spending and climate plan after Democratic senator Joe Manchin said he won’t support the bill. In economic news, leading indicators accelerated more than expected and posted the ninth-straight monthly gain. In other equity news, Oracle Corporation confirmed last week’s reports that it agreed to acquire Cerner Corporation for an equity value of $28.3 billion. Treasuries were mixed, and the U.S. dollar was little changed, while crude oil prices tumbled, and gold fell. Markets in Europe and Asia also finished with widespread losses.

The Dow Jones Industrial Average decreased 433 points (1.2%) to 34,932, the S&P 500 Index declined 53 points (1.1%) to 4,568, and the Nasdaq Composite shed 189 points (1.2%) to 14,981. In heavy volume, 4.5 billion shares of NYSE-listed stocks were traded, and 4.4 billion shares changed hands on the Nasdaq. WTI crude oil fell $2.11 to $68.61 per barrel. Elsewhere, the gold spot price lost $14.80 to $1,790.10 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—was nearly flat at 96.53.

The Conference Board’s Leading Economic Index (LEI) for November rose 1.1% month-over-month (m/m), above the Bloomberg consensus estimate calling for a 1.0% gain and October’s unrevised 0.9% increase. The LEI was positive for the ninth-straight month due largely to the positive net contribution from jobless claims. Other components that helped the index were, stock prices, the interest rate spread, credit, ISM new orders, average workweek, and building permits, which more than offset a negative contribution from consumer expectations.

Treasuries were mixed, as the yield on the 2-year note declined 1 basis point (bp) to 0.63%, while the yield on the 10-year note gained 2 bps to 1.42%, and the 30-year bond rate was up 3 bps at 1.85%.

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