Here is a breakdown of where each market driver currently sits:
U.S. Real GDP growth was 5.2% in the third quarter, a revision from the previously-reported 4.9%. The 5.2% growth was the strongest growth since Q4 2021, in which U.S. Real GDP growth came in at 7.0%. Part of the revision was due to both upward revisions to business investment and inventory, whereas consumer spending was slightly revised downward.
After a robust rally over the past month, the S&P 500 has currently entered overbought territory on a relative strength index, or RSI, basis. RSI levels at or above 70 are considered overbought, and the S&P 500 is currently hovering around this area. We will watch to see if the market takes a breather in the short term, and whether the moving averages can again provide support for the index.
The University of Michigan’s U.S. Index of Consumer Sentiment came in at 61.30 in November, marking four consecutive months of decline in sentiment and the lowest level since May of this year. Current assessment of personal finances improved versus October, whereas expected business conditions decreased to their lowest level since July 2022.
