Morning in New York: macro factors and rate cut prospects in focus

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

Participants in the upcoming trades will focus on the publication of business activity (PMI) in the manufacturing sector for November from ISM Manufacturing (consensus: 49.3 points, October: 48.7) and S&P Global (final estimate, consensus: 51 points). The benchmark for the indicator from ISM is below the 50 point mark, indicating a continued downturn. Both releases will be an important indicator of the state of the economy ahead of the Fed's December meeting. Weaker-than-forecast data will reinforce expectations of a rate cut. Stronger indicators of business activity could put pressure on the market, questioning the need to continue easing monetary policy.

As of today, the Fed officially ends its quantitative tightening (QT) program, a significant step in easing monetary conditions.

US President Donald Trump said that he has decided on a candidate to replace the current head of the regulator Jerome Powell. According to Polymarket, the probability of the appointment of White House adviser Kevin Hassett, who advocates active rate cuts, is 70%. This news strengthens expectations of a "dovish" reversal in the regulator's policy.

Credo Technology Group (CRDO) and MongoDB (MDB) will present quarterly results after the close of the main session.

Futures on U.S. indices show a decline, reflecting investors' wariness before the publication of important statistics. Pressure on quotes is exerted by hawkish comments of the head of the Bank of Japan, which provoked the growth of yields of Japanese government bonds, as well as weakening interest in risky assets in Asian markets. We assess the balance of risks for the upcoming session as negative with high volatility. We focus on the S&P 500 fluctuations in the range from 6780-6880 points (from -1.0% to +0.5% of the previous session's closing level).

- Amazon (AMZN) and Alphabet (GOOGL) announced the launch of a joint service that allows customers to create high-speed private connections between AWS and Google Cloud platforms. The solution aims to improve reliability and simplify operations in multi-cloud environments. Salesforce (CRM) will be one of the first users of the service.

- UnitedHealth Group (UNH) is selling its last South American asset, Banmedica, to Brazilian investment firm Patria Investments for $1 billion. This will allow the insurance giant's management to focus on rebuilding its core business.

- Amid growing demand for microelectronics for AI, Micron Technology (MU) has announced plans to invest $9.6 billion to build an advanced memory chip (HBM) manufacturing facility in Japan with significant support from its government.

- Airbus (EADSY) has issued an emergency recall of about 6,000 A320 family aircraft for an urgent software update. The decision, affecting multiple U.S. airlines, was made after the discovery of a vulnerability potentially linked to solar flares. This action by the airline company demonstrates a new approach to safety in the industry following the Boeing 737 MAX crisis.

- Adobe Analytics estimates U.S. sales on Black Friday totaled $11.8 billion (+9.1% year-over-year).

- Netflix's (NFLX) interest in buying Warner Bros. Discovery (WBD) and the HBO Max service has raised antitrust concerns from the White House.

Trading on November 28 on American stock exchanges, as well as four previous sessions, ended in the plus. S&P 500 added 0.54%, Nasdaq 100 rose by 0.78%, Dow Jones rose by 0.61%, and Russell 2000 - by 0.58%. The key positive driver remained the increased expectations of the Fed easing its monetary policy in December.

The "Magnificent Seven" stocks, led by Meta (META: +2.26%), were moving upwards. The only exception was Nvidia (NVDA: -1.81%). The energy sector (XLE: +1.31%) was the leader of growth in the broad market, with only the healthcare industry (XLV: -0.49%) closing slightly down.

The trading session after Thanksgiving Day was traditionally held in a shortened mode. There were no significant publications in the macroeconomic calendar. Investors continued to put in quotations the return of the Fed to easing monetary policy. The market was also supported by the improvement of the technical picture after the recent correction, which helped to remove overbought in popular positions. Ahead of the December FOMC meeting, the Fed representatives are entering a "period of silence", so the main attention of the investment community will be focused on macro statistics.

- Positive dynamics in shares of Intel (INTC: +10.2%) was caused by reports of industry analyst Ming-Chi Kuo. According to his data, Intel has made progress in negotiations with Apple and may become a supplier of chips for low-level M-series processors manufactured using advanced technological processes as early as in the second half of 2027.

- The increase in the capitalization of USDC stablecoin and the general recovery in the cryptocurrency market supported quotes of Circle Internet Group (CRCL: +10%).

- In a major development in the technology sector, Alphabet (GOOGL: 0.1%) decided to withdraw its appeal to EU antitrust authorities over Microsoft's (MSFT: 1.3%) cloud computing practices as European regulators conduct a major investigation of the entire cloud sector. According to Alphabet's own management, this makes its private complaint redundant.

- China's Wingtech, the parent company of Dutch chip maker Nexperia, intends to challenge the Dutch Supreme Court's decision to strip control of the subsidiary, which was made by the country's authorities over concerns about the movement of intellectual property to China. The dispute continues to create disruptions in the supply of chips widely used in the automotive industry.

This article was AI-translated and verified by a human editor