Stocks in the U.S. continued to trade near record levels this week as investors digested generally upbeat economic data along with corporate earnings results. As of mid-week, the S&P 500 sits about 1.80% higher thus far in November and an impressive 26% higher year-to-date. On the data front, retail sales jumped 1.7% in October, more than doubling the prior month’s gain of 0.8%. Industrial production increased 1.6% in October, partly reflecting the fading impact of Hurricane Ida and a sharp rebound in auto production related to easing lockdown activity in Southeast Asia (GSAM). In housing, the NAHB housing market index increased in November, against consensus expectations for a flat reading. Housing starts decreased by 0.70% in October, against expectations for an increase while building permits increased by more than expected at 4.0%. Interest rates were relatively flat in early trading this week, with the 2-year and 10-year treasury notes trading around 0.51% and 1.63%, respectively, mid-week. After rallying more than 70% this year, oil markets took a breather this week with a barrel of WTI Crude settling around $80 on Wednesday after trading as high as $85 earlier this month. Going forward, we could see elevated volatility leading up to President Biden’s decision regarding the Fed Chair appointment. President Biden said on Tuesday that he would announce his choice in the next few days. Last week, an official of the Biden administration said that the president is still weighing whether to keep Jerome Powell for a second term or elevate Fed Governor Lael Brainard to the position.

Source: GSAM, Daily Upside, JPM, Factor Investor

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