November Market Recap
Already on pace for an exceptional year, the stock market got the catalyst it hardly needed in November.
The presidential election on November 5 ended up being far less close than polls had indicated. Donald Trump won every swing state up for grabs and most media outlets called the race in Trump’s favor before bedtime.
Spurred on by the post-election certainty, and perhaps aided by a particularly definitive result, US stocks enjoyed their best month of the year. All three major benchmarks rose more than 5%, led by the Dow Jones’s 7.5% gain.
All 11 sectors in the S&P 500 finished higher. Consumer Discretionary (+13.2%) and Financials (+10.2%) posted massive gains. Health Care (+0.1%) and Materials (+1.5%) were the biggest laggards for the second month in a row.
Benchmark Returns: November 2024 | YTD 2024
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Dow Jones
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S&P 500
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NASDAQ
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+7.54% | +19.16%
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+5.73% | +26.47%
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+6.21% | +28.02%
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$20 billion of cash flowed into US equities the day after Trump’s victory and the S&P 500 surpassed 6,000 for the first time on November 8. It was the cherry on top of an election-week surge that resulted in the best overall week for the S&P 500 since November 2023. As strong as the gains were for the major stock indices, returns were even better in certain pockets of the market.
Small-cap stocks outperformed significantly. The Russell 2000 increased more in November (+10.8%) than in the first 10 months of the year combined. Banks (+13%) were even stronger than the financial sector as a whole. More speculative assets like cryptocurrencies also catapulted higher.
On the opposite end of the spectrum were international stocks. Expectations of tariffs and hardline political policies from Trump’s incoming administration led investors away from foreign assets. Non-US Developed equities lost 0.3% in November. Emerging Markets fell 2.7%. This after falling 5.3% and 3.1% respectively in October.
Gold prices have sunk 3% since the election. West Texas Intermediate crude oil ended November trading at $68 per barrel, near its recent lows. That may be fueled by the outlook that Trump is likely to increase the flow of oil and gas relative to the more climate-friendly energy policies of his predecessor.
The Federal Reserve met expectations by cutting interest rates 0.25% at its November 7 meeting (this after a 0.50% cut in mid-September). The next Fed meeting is scheduled for December 17-18 and it appears more of a coin flip whether markets will get another “cut” or a “pause” for Christmas.
Bond yields climbed as high as 4.50% in mid-November before moderating. Ten-year US Treasuries ended the month yielding 4.18% (down from 4.28% a month earlier).
With 95% of S&P 500 companies having reported third-quarter earnings, we are on track for 5.8% earnings growth from a year earlier. That’s above consensus expectations of 4.2% growth as of September 30.
Inflation numbers ticked slightly higher last month but remained in line with expectations. The most recent Consumer Price Index (CPI) showed 2.6% inflation over the last 12 months. The latest Personal Consumption Expenditures (PCE) index increased 2.3% from a year ago. Neither report caused any major market ripples.
Historically, November is the best month for stocks in election years and it certainly lived up to its reputation.
Ben Marks
Chief Investment Officer
Brett Angel
Senior Wealth Advisor
Investment Advice offered through Marks Group Wealth Management, a Registered Investment Advisor.
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The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
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Russell 1000 Growth Index measures the performance of those Russell 1000 companies with higher price to-book ratios and higher forecasted growth values.
Russell 1000 Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.
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VIX-The Chicago Board Options Exchange’s CBOE Volatility Index, a popular measure of the stock market’s expectation of volatility based on S&P 500 index options. It is calculated and disseminated on a real-time basis by the CBOE, and is often referred to as the fear index or fear gauge.
