Weekly Market Commentary – 11/10/2023

-Darren Leavitt, CFA

Markets were mixed this week as investors digested additional earnings announcements, a plethora of Fed rhetoric, and a large dose of US Treasury issuance.  The divergence of mega-cap stocks widened relative to equally weighted indices, mid-cap issues, and small-caps.  Technology stocks were in favor, catalyzed by a solid report from Taiwan Semiconductor and news that NVidia will supply China chips that circumvent the current ban on technology exports to China.  The energy sector continued to be laggard due to fears of slower global growth.

The Israel- Hamas conflict continued with Israel encircling Gaza City. The US and Israel conducted airstrikes in Syria but markets seemed to shrug off the notion of a broadening conflict.  The global community continued to call for more humanitarian aid but fell short of calling for a ceasefire.  The economic calendar was light this week.

The S&P 500 climbed 1.3% on the week and closed above 4400.  The S&P 500 is up over 7% since the end of October and is up 15% year to date.  The Dow added 0.7%, the NASDAQ jumped 2.4%, and the Russell 2000 gave up 3.1%.  US Treasuries regressed after their stellar performance from a couple of weeks ago.  A horrible 30-year auction followed a decent 3-year and 10-year auction.  Shorter-tenured Treasuries fell more than longer-tenured bonds.   The 2-year yield increased by nineteen basis points to 5.05%, while the 10-year yield increased by seven basis points to 4.63%.  The commodity complex also faced selling.  Oil prices fell by $3.57 or 4.4% to $77.21 a barrel.  Gold prices lost $60.30 or 3% to close at $1939.10.  Copper prices decreased by $0.09 to $3.59 a lb.  Bitcoin closed north of $37,000 as investor enthusiasm toward a spot Bitcoin ETF approval continued.

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