(Bloomberg) — A rally that drove stocks to a series of all-time highs struggled to gain much traction, with traders awaiting key inflation data and more clues on Donald Trump’s transition to presidency.
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Equities wavered after the S&P 500’s biggest five-day run in a year. Following sizable post-election gains, small caps lost some ground. Bitcoin fell after a record-breaking surge that took the digital asset close to $90,000. The dollar headed toward its highest since November 2022. Treasury yields climbed as investors prepared for data to show a slight pickup in consumer prices.
The post-election advance in US stocks could run out of steam as investors start to take profits, according to strategists at Citigroup Inc. led by Chris Montagu. Investor exposure to US stocks jumped to the highest since 2013 after the presidential vote amid optimism around stronger economic growth, according to a survey from Bank of America Corp. About 22% of participants responded after the election results on Nov. 6 and showed a “surge in bulls,” strategist Michael Hartnett wrote.
“We are on watch for potential profit taking, consolidation, or even correction for US equities heading into the first quarter of the new year,” said Dan Wantrobski at Janney Montgomery Scott. “Upward momentum remains strong and investor sentiment favorable (pushing toward extremes again), but stocks are once again overbought/extended across multiple timeframes.”
Corporate Highlights:
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Qualcomm Inc. Chief Executive Officer Cristiano Amon said the artificial intelligence boom won’t lead to a global chip shortage similar to what happened during the pandemic, even with demand for AI-enabled smartphones rising.
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Apple Inc. was notified by the European Union that its geo-blocking practices are potentially in breach of consumer protection rules, adding to the iPhone maker’s regulatory issues in the bloc.
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Home Depot Inc. lifted its forecast of a key sales metric for the year after adverse weather propped up demand for home-improvement materials in the latest quarter.
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Elliott Investment Management has built a $5 billion-plus position in Honeywell International Inc. and is pushing the industrials giant to pursue a break up.
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Tyson Foods Inc. beat fourth-quarter earnings and projecting stronger results next year, with a turnaround in its chicken business offsetting losses in beef.
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Hertz Global Holdings Inc. reported a worse-than-expected loss stemming from the rental-car company’s effort to unwind a failed bet on electric vehicles that has pummeled earnings for most of the past year.
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Shopify Inc. reported third-quarter sales that beat analysts’ estimates, a sign that the Canadian e-commerce company is gaining momentum as spending continues to shift from stores to websites.
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Bayer AG tumbled after the German conglomerate lowered profit guidance for this year and said earnings will probably fall in 2025.
