U.S. stocks saw a mixed performance on Friday following a significant rally the day before, driven by news of a slowdown in inflation in October. The Dow Jones Industrial Average was down 0.3%, while the S&P 500 and Nasdaq were up 0.6% and 1.5% respectively. The positive report on inflation raised hopes that the Federal Reserve may scale back its aggressive interest rate hikes, with many analysts predicting a smaller rate increase in December.
The S&P 500 and Nasdaq experienced their largest gains since the early days of the pandemic, surging by 5.5% and 7.4% respectively, with the Dow rising over 1,200 points. However, cryptocurrencies continued to decline, with Bitcoin dropping by 5% to around $16,526 as FTX filed for bankruptcy and CEO Sam Bankman-Fried resigned. On Singles’ Day, Alibaba received a boost as the Chinese government announced plans to relax Covid-related restrictions, causing shares to rise by 1.7%.
The University of Michigan’s survey for November reported a decrease to 54.7 from 59.9 in October, below economists’ expectations of 59.5. Bond markets were closed on Friday for the Veterans Day holiday. Oil prices saw an increase, with Brent crude rising by 3.6% to $89.54 a barrel, WTI crude up by 3% to $96.41 a barrel, and gold prices up by 0.6% to $1,765.
Overall, the market showed signs of optimism following the inflation data and expectations of a more gradual interest rate hike by the Federal Reserve. The strong performance of major indices and increased oil prices reflected this positive sentiment. However, the decline in cryptocurrencies and lower consumer sentiment indicated ongoing challenges in the market. Investors will be watching closely for further developments in monetary policy and economic indicators to gauge the direction of the market in the coming weeks.
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