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- US stocks rallied, led by the Dow Jones, after Scott Bessent’s nomination to run the Treasury Deparment.
- Bessent is seen as a stabilizing, pro-market force that could counter some of Trump’s inflationary policies.
- Investors are eyeing key data releases in the holiday-shortened trading week, including PCE and GDP data.
US stocks extended their rally on Monday, led by the Dow Jones Industrial Average, which surged 440 points and closed at a record.
The S&P 500 and the Nasdaq Composite also gained. The small-cap Russell 2000 jumped 1.7% to an all-time high.
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Investors cheered President-elect Donald Trump’s pick for Treasury Secretary, former hedge fund manager Scott Bessent.
The pick of Bessent sparked a sell-off in the US dollar, Treasury yields, and gold as Wall Street expects him to pursue pro-market policies that help spur economic growth and limit inflation.
The former global macro investor is seen as a pro-market, stabilizing force that could counter some of Trump’s plans that could stoke inflation or further balloon the deficit.
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Bond yields dropped as investors saw Bessent’s nomination as lowering the potential for a spike in inflation in 2025 and beyond. The 10-year Treasury yield plunged 14 basis points to 4.268%.
“The choice of Scott Bessent as Treasury secretary seems to have allayed major fiscal concerns,” economist James Reilly of Capital Economics said.
Reports say Bessent pitched the 3-3-3 plan to Trump earlier this year, which was received favorably. The plan refers to three targets: cut the budget deficit to 3% of gross domestic product by 2028, spur annual GDP growth to 3% via deregulation, and produce an additional 3 million barrels of oil per day. He has also floated the idea of gradually implementing tariffs to avoid causing a sudden, painful spike in inflation.
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“Bessent as Treasury Secretary lends substantial economic and market credibility to the cabinet,” Fundstrat’s head of research Tom Lee said, adding that his role will be a positive for market dynamics heading into 2025.
Meanwhile, it’s a busy week for economic data despite the shortened holiday week.
Investors will get initial jobless claims, a third-quarter GDP revision, and personal consumption expenditures data on Wednesday morning, as the stock market is closed on Thursday in observance of Thanksgiving.
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Economists expect initial jobless claims to come in at 215,000, and third-quarter GDP growth to be 2.8%, while PCE inflation data is expected to be the same as last month at 0.2% on a month-over-month basis.
Here’s where US indexes stood at the 4:00 p.m. closing bell on Monday:
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Here’s what else is going on:
In commodities, bonds, and crypto:
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- West Texas Intermediate crude oil dropped 3.06% to $69.06 a barrel. Brent crude, the international benchmark, was lower by 2.69% to $73.15 a barrel.
- Gold declined 3.07% to $2,628.80 an ounce.
- The 10-year Treasury yield dropped 14 basis points to 4.268%.
- Bitcoin fell 3.48% to $94,605.