Here is a breakdown of where each market driver currently sits:
The U.S. Consumer Price Index (CPI) came in at 3.24% year-over-year in October, slightly higher than September’s level of 3.70%. The Core CPI, which excludes food and energy costs, came in at 4.03% year-over-year in October, lower than September’s level of 4.15%.
The S&P 500 has rebounded significantly since closing nearly -3% below its 200-Day Moving Average, with the S&P 500 recapturing both its 200-Day Moving Average and 50-Day Moving Average. The S&P 500 recapturing both of its moving averages is a positive technical development and should provide support for the index in the short term.
Investment sentiment has flipped significantly last week, with the percent of investors feeling bullish about the next six months in the AAII Investor Sentiment Survey reaching 42.6%, significantly higher than the previous week’s level of 24.3%. This sentiment flip coincided with a strong rebound by the S&P 500 since the end of October.
