November 2024 Commentary
Market Overview
The S&P 500® had its best month of the year in November, up 5.73% to 6,032.98, breaking the 6,000 mark during a post-U.S election rally. Unlike the stock market enthusiasm fueled by Consumer Discretionary and the Financials sectors, U.S Treasury yields (as measured by the iBoxx USD Treasuries) fell 8 bps to 4.31% for the month. The Conference Board Consumer Confidence Index increased 2.1 points in November, citing confidence in the labor and stock markets, as well as overall better economic prospects with a new U.S. presidency. Against this positive economic backdrop, the newly elected president warned BRICS+ countries with 100% tariffs unless a promise was made to not create their own currency and move away from the dollar. Additionally, USMCA members—Mexico and Canada—face potential tariff increases of 25% over ongoing border issues. All these countries are major steel, oil, consumer goods and precious metals producers. The latest U.S. inflation (CPI) reading in October was 2.6%. According to a macroeconomic analysis by Yale University, applying these tariffs would mean a loss in average disposable income of USD 1,900 to USD 7,600 (in 2023 dollars).
Annual inflation for the eurozone was up 2.3% in November, fueled by price increases in services and food prices, while the unemployment rate came in at 6.3% for October. Meanwhile, the HSBC India Manufacturing PMI decreased to 56.5 in November due to deceleration in new orders and higher inflationary pressures.
