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Weekly Economic and Stock Market Commentary – December 4, 2023

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As for the stock market specifically:

Readers of a certain age will remember a song by the 5th Dimension that describes the stock market action that started at the end of October and continued through last week. For those of you who don’t remember, or were born too late to hear it as a child, the song is “Up, Up, and Away.” The markets saw their fourth consecutive weekly gain as we put the last page of the calendar on the refrigerator. Please recall, I’ve said many, many times, there is a seasonal bias that tends to favor Q-4, and Q-1… we’ve turned the calendar to Q-4. (Please note, I did say “bias”, not a certainty).

What I liked about last week was the way smaller company stocks participated in the gains. That shows a broadening of gains from the very few stocks (i.e. the so-called Magnificent Seven) that comprise a high degree of the gains by the Nasdaq Composite and S & P 500.

Another aspect involved in last week’s movement was falling long-term interest rates. Time will tell as to whether that was correlation or causation.

For those readers who are required to take IRA distributions, and have yet to do so, please contact Elise, or me, as soon as possible.

It was a good week for the bullish percent indicators. All of them continued to gain ground, and we continue to have great field position. WEALTH ACCUMULATION strategies are in effect in all areas.

Remember, Xs means OFFENSE or wealth accumulation, while Os means DEFENSE or wealth preservation.

Below is where our indicators stand as of December 1, 2023 (Courtesy Dorsey, Wright, and Associates).

On a general note:

The Department of Commerce gave a revision to the 3rd quarter Gross Domestic Product. They announced an upward revision in the growth rate to a 5.2% annualized growth rate. Economists anticipated a gain of 5.0%. Normally I see a bunch of people throwing cold water (I have been known to do that myself) on economic reports, but not this time.

The Federal Reserve reported its Personal Consumption Expenditure measurement of inflation came in at 3.0% on a year-over-year basis. That was where economists anticipated it would be. That still is above the 2% level they reportedly want to see. On a monthly basis, this tool showed no movement. The core level, which is for people who do not eat or use energy, was up 3.5% on an annual basis.

As always, please contact me if you want more information or have any questions.