Why a Major Sector Rotation Could Be Underway Amid Surging Inflation

by | Dec 10, 2021 | Market Updates

The market is gaining strength again after Thursday’s downward slide, even on the heels of the worst inflation data in four decades — and more in Friday’s stock market recap.

The slide we saw on Thursday shouldn’t have been a surprise after watching the market jump so high so quickly earlier this week. 

However, we are likely to see extended volatility on Friday for two reasons. One, there are less traders out as we move toward the weekend, meaning less liquidity. And two, we also have two more important reports being released, the Consumer Price Index and Consumer Sentiment. More on the data and inflation below…

The Senate voted to allow Congress to increase the debt ceiling, avoiding the risk of default.

And CEO Elon Musk offloaded roughly $1 billion worth of Tesla Inc. (Nasdaq: TSLA) shares, sending the stock price down another 1% following its recent 6% slide earlier this week. 

In this morning’s stock market recap video, you’ll learn which sector is cooling off and which is heating up… whether bonds have more downside to go… whether market internals are sending a warning sign… the current volatility levels you need to pay attention to… a review of a winning trade from this week… and a preview of major Federal Reserve data that’s on the table.

Don’t forget to like and subscribe to our YouTube channel if you haven’t already so you can be notified as soon as we post our next video and see what other trade opportunities we’re paying close attention to! 

 

Roger’s Radar: Inflation Sees Biggest Jump Since Reagan’s First Term

We got the latest inflation data this morning, which showed the fastest acceleration since 1982 during Ronald Reagan’s first term as president…

The Consumer Price Index rose 0.8% for the month of November, pushing the year-over-year rate up to 6.8%. 

Per CNBC:

Excluding food and energy prices, so-called core CPI was up 0.5% for the month and 4.9% from a year ago, which itself was the sharpest pickup since mid-1991.

The Dow Jones estimate was for a 6.7% annual gain for headline CPI and 4.9% for core.

Price increases came from familiar culprits.

Energy prices have risen 33.3% since November 2020, including a 3.5% surge in November. Gasoline alone is up 58.1%.

Food prices have jumped 6.1% over the year, while used car and truck prices, a major contributor to the inflation burst, are up 31.4%, following a 2.5% increase last month.

The Labor Department said the increases for the food and energy components were the fastest 12-month gains in at least 13 years.

Stock Market Recap: By the Numbers

This morning’s stock market futures recap: 

DOW (mini)

  • Close: 35,754.69. 
  • Futures: 35,836. 
  • Change: +177. 

S&P 500 (mini)

  • Close: 4,667.45. 
  • Futures: 4,692.5. 
  • Change: +32.75. 

NASDAQ (mini)

  • Close: 16,149.57. 
  • Futures: 16,283.25. 
  • Change: +131.75. 

RUSSELL (mini)

  • Close: 2,220.21. 
  • Futures: 2,235.2. 
  • Change: +19.8. 

Note: Updated as of 09:23 a.m. EST

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Check back each morning for Roger’s Radar and the most important news and numbers in the WealthPress stock market recap.

WRITTEN BY<br>Roger Scott

WRITTEN BY
Roger Scott

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