Market Rebounds Despite Government Shutdown Fears
The US stock market staged a remarkable comeback on Friday, defying expectations of a government shutdown and digesting key inflation data. The tech-heavy Nasdaq Composite gained 0.6%, while the S&P 500 and Dow Jones Industrial Average rose 0.7% and 0.8%, respectively.
Inflation Data Shows Deceleration
The Federal Reserve’s preferred inflation gauge, the core Personal Consumption Expenditures (PCE) index, revealed a deceleration in price increases during November. The index rose 0.1% from the prior month, a slower pace than October’s 0.3% monthly gain. On a yearly basis, core prices rose 2.8%, matching the increase seen in October.
Global Chip Stocks Feel the Heat
Global chip stocks took a hit as President Trump threatened tariffs on goods from Europe. ASML, a Dutch manufacturer of advanced chipmaking machines, fell as much as 2% early Friday. Taiwan-based chip manufacturer TSMC saw its shares dip 2.4%. US-based names such as Nvidia, AMD, and Broadcom also came under pressure.
Bitcoin Prices Retreat
Bitcoin prices dropped below $95,000 per token amid record ETF outflows. The cryptocurrency’s value has been volatile in recent weeks, and investors are closely watching its performance.
Novo Nordisk Shares Plummet
Novo Nordisk’s stock tumbled more than 20% after its obesity drug trial disappointed investors. The company’s experimental obesity drug led to a 22.7% weight loss in the trial, falling short of the expected 25%. The stock’s decline wiped out as much as $125 billion in market value.
Tesla Recalls Vehicles
Tesla shares dropped 6% after the company recalled about 700,000 US vehicles over a tire pressure monitoring system defect. The recall is a significant blow to the electric vehicle maker, which has faced several challenges in recent months.
Economic Data and Earnings
Investors will be closely monitoring a range of economic data and earnings reports in the coming days. Key releases include personal income, personal spending, and the University of Michigan consumer sentiment index. Carnival Corporation and Winnebago are among the companies set to report earnings.
Other Market News
In other market news, the House of Representatives voted against a Trump-backed spending bill, increasing the odds of a government shutdown this weekend. Trump also threatened tariffs on Europe, citing a “tremendous deficit” with the US. The move has sparked concerns about global trade and economic growth.
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