S&P 500 Posts Best Month in Over a Year
Markets ended November on a high note, with the S&P 500 rising 0.8%, the NASDAQ up 0.4%, and the Dow climbing 2.4% during the week. For the full month, the S&P 500 gained 8.9%, marking its best monthly performance since July 2022.
Investors responded to encouraging signs of easing inflation and a shift in expectations around Federal Reserve policy. The Fed’s next meeting is mid-December, and markets are increasingly focused on whether rate cuts could emerge in early 2026.
Core PCE Shows Continued Progress
The Core Personal Consumption Expenditures (PCE) price index — the Fed’s preferred inflation gauge — rose 0.2% in October, with the year-over-year rate falling to 3.5%. The headline PCE rate came in slightly lower at 3.0%, reflecting ongoing disinflation trends.
Other data included a modest drop in jobless claims and an uptick in consumer sentiment, helping reinforce a cautiously optimistic outlook.
Sector Rotation Reflects Rate Sensitivity
Real estate and utilities sectors outperformed during the week, reflecting sensitivity to falling yields and expectations that rates could eventually move lower. Energy stocks declined again as oil prices weakened, while technology and small caps were more mixed following November’s earlier surge.
International markets also finished higher, aided by improving inflation data in Europe and more stable currency movements.
Alphastar CIO Tony Parish noted:
“Slower inflation and improving sentiment have clearly changed the tone of the market”
Here are three takeaways for investors:
-
Inflation Trends Support Policy Patience
With core PCE now showing consistent progress, the Fed may feel less urgency to keep rates elevated, barring a surprise in labor or inflation data.
-
Rate-Sensitive Sectors Gaining Ground
Utilities and real estate stocks — often among the most impacted by interest rate expectations — may continue to benefit if yields decline further.
-
Market Tone More Constructive, but Data Still Key
Investor sentiment has improved, but inflation, wage growth, and labor market updates will continue to shape the Fed’s next steps.
Final Thoughts
November delivered a strong rebound for equities, with falling inflation and more stable economic data helping shift the market’s tone. While attention will now turn to the Fed’s December meeting, the broader backdrop appears more constructive than earlier in the quarter.
As Tony Parish summed it up:
“November’s rally reflected a real shift in expectations — not just on rates, but on what investors are willing to price in moving forward.”
READ THE FULL REPORT
Disclosure:
This blog post is for informational purposes only and should not be considered investment advice. Past performance does not guarantee future results. All data is as of December 1, 2025. Please consult with a qualified financial professional for personalized advice.
Equities Close Out Strong November as Inflation Slows: Week of December 1, 2025
S&P 500 Posts Best Month in Over a Year
Markets ended November on a high note, with the S&P 500 rising 0.8%, the NASDAQ up 0.4%, and the Dow climbing 2.4% during the week. For the full month, the S&P 500 gained 8.9%, marking its best monthly performance since July 2022.
Investors responded to encouraging signs of easing inflation and a shift in expectations around Federal Reserve policy. The Fed’s next meeting is mid-December, and markets are increasingly focused on whether rate cuts could emerge in early 2026.
Core PCE Shows Continued Progress
The Core Personal Consumption Expenditures (PCE) price index — the Fed’s preferred inflation gauge — rose 0.2% in October, with the year-over-year rate falling to 3.5%. The headline PCE rate came in slightly lower at 3.0%, reflecting ongoing disinflation trends.
Other data included a modest drop in jobless claims and an uptick in consumer sentiment, helping reinforce a cautiously optimistic outlook.
Sector Rotation Reflects Rate Sensitivity
Real estate and utilities sectors outperformed during the week, reflecting sensitivity to falling yields and expectations that rates could eventually move lower. Energy stocks declined again as oil prices weakened, while technology and small caps were more mixed following November’s earlier surge.
International markets also finished higher, aided by improving inflation data in Europe and more stable currency movements.
Alphastar CIO Tony Parish noted:
Here are three takeaways for investors:
Inflation Trends Support Policy Patience
With core PCE now showing consistent progress, the Fed may feel less urgency to keep rates elevated, barring a surprise in labor or inflation data.
Rate-Sensitive Sectors Gaining Ground
Utilities and real estate stocks — often among the most impacted by interest rate expectations — may continue to benefit if yields decline further.
Market Tone More Constructive, but Data Still Key
Investor sentiment has improved, but inflation, wage growth, and labor market updates will continue to shape the Fed’s next steps.
Final Thoughts
November delivered a strong rebound for equities, with falling inflation and more stable economic data helping shift the market’s tone. While attention will now turn to the Fed’s December meeting, the broader backdrop appears more constructive than earlier in the quarter.
As Tony Parish summed it up:
READ THE FULL REPORT
Disclosure:
This blog post is for informational purposes only and should not be considered investment advice. Past performance does not guarantee future results. All data is as of December 1, 2025. Please consult with a qualified financial professional for personalized advice.