Thanksgiving Week Earnings, Economic Reports, Market Recap & More: Monday’s Top 5 Things to Know

Here are the key events taking place on Monday which could impact trading.

EARNINGS REPORTS CONTINUE: Retailers will be in focus for the second week in a row with many specialist and second-tier names reporting quarterly results.

As of Monday, Urban Outfitters will be among the companies providing third-quarter earnings.

Also on Monday, look for Dell Technologies, Jacobs Solutions, jelly maker JM Smucker Co., Agilent Technologies, and Zoom Video Communications.

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Tickers Safety Last Change Change %
DELL DELL TECHNOLOGIES INC. 40.22 -1.82 -4.34%
j JACOBS ENGINEERING GROUP INC. 126.04 +1.78 +1.43%
SJ extension THE JM SMUCKER CO. 147.30 +1.08 +0.74%
A AGILENT TECHNOLOGIES INC. 146.19 +1.75 +1.21%
ZM extension ZOOM VIDEO COMMUNICATIONS INC. 80.94 -0.69 -0.85%

Dell Technologies Inc. will share its latest earnings report on Monday. (Dell Technologies)

On Tuesday, look for PC and printer maker HP Inc., device maker Medtronic PLC, cloud computing company VMware Inc., soup giant Campbell Soup Co., Warner Music Group Corp., Baidu, Autodesk, and Analog Devices Inc.

Tickers Safety Last Change Change %
MDT extension PLC METRONIC 81.30 +1.36 +1.70%
vmw extension VMWARE INC. 116.56 +1.13 +0.98%
ADI ANALOG DEVICES INC. 161.85 +0.38 +0.24%
DE DEERE & CO. 414.26 +1.27 +0.31%
CPB extension CAMPBELL SOUP CO. 51.56 +1.07 +2.12%
WMG extension WARNER MUSIC GROUP CORP. 26.86 -0.35 -1.30%
ADSK AUTODESK INC. 210.37 -4.31 -2.01%
BIDU BAIDU INC. 95.97 -3.61 -3.63%

Finally, farm equipment maker Deere & Co. will report its third-quarter earnings on Wednesday.

ECONOMIC RELATIONS: It will be a relatively quiet week for economic data due to the shortened work week over the Thanksgiving holiday.

All reports will be released on Wednesday.

Look for initial jobless claims, durable goods data, and new home sales for October.

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People filing unemployment claims in Georgia

Job seekers enter the Gwinnett office of the Georgia Department of Labor in Gwinnett, Georgia. (Chris Rank/Bloomberg via Getty Images)

In addition, the University of Michigan’s final consumer sentiment index for November will be released on Wednesday.

The minutes of the Nov. 1-2 Fed policy meeting are also slated for release.

MARKET SUMMARY: Shares rallied on Friday, capping off a tumultuous week as investors weighed the outlook for interest rates.

The S&P 500 gained 18.78 points, or 0.5%, to 3965.34, while the Nasdaq Composite was up 1.10 points, or less than 0.1%, or 11146.06. The Dow Jones Industrial Average rose 199.37 points, or 0.6%, to 33745.69.

All three indices have dropped two of the last three weeks. Of the 11 sectors within the S&P 500, nine rallied on Friday. The only laggards were stocks in the energy and communications services sectors.

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Stock traders on the New York Stock Exchange

Traders work on the floor at the New York Stock Exchange in New York on Wednesday, November 2, 2022. (AP Photo/Seth Wenig / AP Images)

A slowdown in inflation sent stocks higher last week and the dollar and bond yields in retreat. The S&P wrapped up its best stretch since the summer last week.

But in recent days, hopes that the Federal Reserve will roll back its campaign of aggressive interest rate hikes have somewhat faded.

“We rallied 6% in the S&P 500 last week. We don’t think the Fed wants to see a return of spirit animals,” said Derek Amey, co-chief investment officer at StrategicPoint Investment Advisors in Rhode Island.

Amey said he is hiding from volatility by holding industrial and health care stocks alongside bonds.

Central bank officials, including St. Louis Fed Chairman James Bullard, this week argued for continuing to hike rates to curb decades-high inflation.

Bullard said on Thursday that the Fed’s policy rate could rise more than interest rate futures traders expect. Strong data on labor markets and retail sales, meanwhile, suggest the economy still has a long way to go before higher borrowing costs cause the kind of recession that could prompt the Fed to reverse course.

All of this has had the stock market on edge, even though the S&P 500 is still about 11% above its recent Oct. 12 low.

DOMESTIC SALES: On the economic front, US existing home sales fell for the ninth consecutive month in October as high mortgage rates drove buyers out of the market.

“There is no guarantee that inflation is behind us,” said Peter Boockvar, chief investment officer at Bleakley Financial Group. “Where it stabilizes is really the most important thing here. Do we go back to its pre-Covid trend of 1 to 2% or do we stabilize at 3 to 4%?”

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A red and white for sale sign sits on a property

A “Home For Sale” sign is visible in front of an existing home. (Tim Boyle/Getty Images/Getty Images)

Boockvar said he is betting inflation will be between 3% and 4% in 2023.

He expects to continue to hold Treasury inflation-protected securities and shares in the precious metals and energy sectors, which tend to do better in times of inflation.

TREASURE UPDATES: Treasury yields are reversed, with short-term US government borrowing costs exceeding long-term yields.

This dynamic has, in the past, often been predictive of a recession.

The yield on the 10-year Treasury note rose to 3.817% from 3.774% on Thursday.

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Many investors expect the Fed to stop raising rates early next year, but to keep them elevated for some time. This could continue to challenge equities, especially those with high valuations.

“Once the Fed starts seeing cracks in the jobs and inflation data, we will pause for January and February,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

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Cardillo said he expects the S&P 500 to rise to 4150 points by the end of this year, citing historical data that stocks tend to do better during the Christmas holidays. It would be 4.5% higher than its current level.

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