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Stocks closed lower on Friday, but up sharply for the week for the second week in a row.
Some profit taking was bound to set in after the last two weeks we've had. But stocks still managed to hold onto big gains for the week.
Traders are expecting good things between now and the end of the year. As I mentioned last week, the market typically goes up after the midterms. In fact, since WW2 (last 72 years), there's been 18 midterm elections, and in every one the market was higher 12 months later by an average of 17%.
And since November and December are historically strong months for the market, especially after midterms, there's no time to waste.
In other news, Friday's Producer Price Index-Final Demand report was up 0.6% m/m, and 2.9% y/y. Less food & energy, that number comes in at 2.6%, up a bit from last month's snapshot of 2.5%. Analysts noted that while this shows inflation ticking up a little, the recent downturn in energy "looks to take a lot of steam out of November's inflation reports."
Wholesale Trade showed a 0.4% m/m rise in inventories. For the year, inventories are up 5.2% while sales are up an even larger 7.8%. This shows a "need for further restocking."
And Consumer Sentiment came in at a "steady and strong" 98.3 reading, in what is shaping up to be its "best year since 2000."
The economy looks fantastic. And seasonally, this is a great time for the market.
So make sure you're taking full advantage of it.
See you tomorrow,
Kevin Matras
Executive Vice President, Zacks Investment Research
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Stocks closed lower on Friday, but up sharply for the week for the second week in a row.
