Weekly Market Insights | Solid Gains for Thanksgiving Week

December 02, 2024

Stocks posted solid gains over a short and busy holiday week as investors parsed fresh economic data, comments on potential future trade policy, and a few Q3 reports from technology companies.

The Standard & Poor’s 500 Index gained 1.06 percent, while the Nasdaq Composite Index advanced 1.13 percent. The Dow Jones Industrial Average rose 1.39 percent. The MSCI EAFE Index, which tracks developed overseas stock markets, added 2.02 percent.^1,2

Rally Extends

Stocks staged a broad-based rally to start the week as investors reacted to the nominee for Secretary of the Treasury. Small-cap stocks continued their month-to-date surge as the Russell 2000 Index rose to an all-time high. News that consumer confidence rose in November appeared to contribute to gains.^3,4

Then stocks took a pre-Thanksgiving pause as investors digested economic data. Also, disappointing Q3 updates from two computer hardware manufacturers weighed on the tech sector in pre-Thanksgiving trading.⁵

Semiconductor stocks rallied on Friday, pushing all three averages higher for a second straight week. The Dow cracked 45,000 for the first time, and the S&P 500 hit a new record high—with each index closing out its best month of 2024.⁶

Bitcoin and the digital World

Many crypto enthusiasts are hoping that the bitcoin (BTC) bull market has further to run with world's largest cryptocurrency expected to punch through the $100,000 level. 2024 has turned out to be a great year for Bitcoin which is now expected to continue to rise for several reasons: Increasing institutional and corporate adoption, the potential for the creation of bitcoin nation-state reserves, and a new pro-crypto Washington administration.

However, I am concerned that trillions of fiat currencies are flowing into Bitcoin and we do not know who created it. Reference is made to Satoshi, but who is this individual or entity? We would not use chips for our computers, planes, tanks, missiles, vehicles, appliances etc., if we did not know their origin, so why are governments allowing trillions to be directed into Bitcoin which will become more and more of an integral part of the entire global financial system? Especially now with Bitcoin being considered as a strategic reserve asset on government balance sheets and already on many corporate balance sheets.

Further, I think greed, speculation and FOMO are somewhat responsible for driving up the price of the limited supply of Bitcoin. As a Certified Digital Asset Advisor™, I understand the merits of Bitcoin. However, as a Certified Financial Fiduciary™ I think it is critical to raise the concerns of Bitcoin becoming too big to fail in the future.

I understand that Bitcoin is open-source code, but what if the creator also coded a hidden back door and pulls the original blocks sending Bitcoin to zero? Which raises the question: Is Bitcoin a Trojan Horse? Until we know the identity of Satoshi and vet him, her or them, I think Bitcoin dramatically increasing in value in the future has the potential to become a threat to US National Security and the entire Global Financial system. Yes, Bitcoin is being revered as digital gold and those that know me understand my thoughts on physical gold as a true store of value of the ages and real money that has stood the test of time for thousands of years.

If the pundits are right and in the future Bitcoin rises towards 100 trillion dollars equivalent value being held globally by investors, countries, companies and institutions, the World will not be able to afford Bitcoin imploding for whatever reasons.

I wish all my crypto investing friends and colleagues the very best, but we all need to find out who created Bitcoin and vet them to avoid a potential future financial catastrophe. Full disclosure, I personally own Bitcoin and Ethereum.

Tariff Talk

Some of the post-election rally has been driven by investor expectations for less regulation and lower corporate taxes proposed by the incoming administration. One area of concern has been the economic impact of proposed tariffs.

Some market observers believe that the markets have already priced in the impact of these tariffs. In contrast, others see a new Treasury Secretary as a potential buffer in the tariff talks.⁷

This Week: Key Economic Data

Monday: ISM Manufacturing Index. Construction Spending. Fed Official John Williams speaks.

Tuesday: Motor Vehicle Sales. Fed Official Austan Goolsbee speaks.

Wednesday: ADP Employment Report. Fed Official Alberto Musalem speaks. Factory Orders. EIA Petroleum Status Report.

Thursday: Jobless Claims. International Trade in Goods and Services. Fed Official Thomas Barkin speaks. Fed Balance Sheet.

Friday: Employment Situation. Consumer Sentiment. Fed Officials Mary Daly, Beth Hammack and Austan Goolsbee speak.

^{Source: Investors Business Daily - Econoday economic calendar; November 29, 2024}^{The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Tuesday: Salesforce Inc. (CRM), Marvell Technology, Inc. (MRVL)

Wednesday: Synopsys, Inc. (SNPS)

Thursday: The Kroger Co. (KR)

^{Source: Zacks, November 29, 2024.}^{Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

“I imagine one of the reasons people cling to their hates so stubbornly is because they sense, once hate is gone, they will be forced to deal with pain.”

– James Baldwin

How to Verify Your Identity When Calling the IRS

When calling the IRS, you can expect them to verify your identity before delving into personal information. Here’s what you’ll need to verify your identity:

Social Security number
Birthdate
An Individual Taxpayer Identification Number if you have one instead of your SSN
Your filing status
Your prior tax return. You may need information from your prior year’s return to answer certain questions.
A copy of the tax return you’re calling about
Any letters or notices you’ve received from the IRS

Important note: the IRS will only ask for this in documents or online. Never offer this info to someone who calls you and says they are from the IRS.

Having all this information handy before you call the IRS will make the process faster because IRS phone operators will only speak with the taxpayer or a legally designated representative.

This information is not a substitute for individualized tax advice. Please discuss your specific tax issues with a qualified tax professional.

Tip adapted from IRS⁸

How to Get the Recommended 10,000 Steps a Day

Getting 10,000 steps in throughout the day (or moving at all!) might sound impossible, but you can make minor tweaks to get those feet moving. Here are a few ideas:

When running errands, park your car further away and walk from there.
Create a “loop” in your hours that you can walk in between meetings or when you need to get up from your desk. Your loop could even be around the kitchen island!
Walk in place while watching TV.
Listen to a great podcast or audiobook while you walk. It will make the time go by faster!

Tip adapted from Organizing Moms⁹

What has one eye and yet can’t see?

Last week’s riddle: A palindrome is any word, phrase, or number that reads the same, either forward or backward. Can you think of a palindrome word spelled in all capitals that looks the same backward, forwards, or upside down? Answer: NOON.

Indonesian Turtle Hatchling

Ujung Genteng, West Java, Indonesia

Footnotes and Sources

^{1. The Wall Street Journal, November 29, 2024}

^{2. Investing.com, November 29, 2024}

^{3. The Wall Street Journal, November 25, 2024}

^{4. CNBC.com, November 26, 2024}

^{5. The Wall Street Journal, November 27, 2024}

^{6. The Wall Street Journal, November 29, 2024}

^{7. CNBC.com, November 26, 2024}

^{8. IRS.gov, October 23, 2023}

^{9. Organizing Moms, July 24, 2024}

Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.

The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.

The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.

The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.

U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.

Please consult your financial professional for additional information.

This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.