Dow closes lower Monday as four-week rally takes a break: Live updates

Stocks closed lower on Monday.

The Dow Jones Industrial Average lost about 56.68 points, or 0.16%, to 35,333.47. The S&P 500 shed 0.20% to 4,550.43. The Nasdaq Composite edged lower 0.07% to 14,241.02.

— Pia Singh

Markets still think there's little chance the Federal Reserve will be raising interest rates anytime soon, despite a strong stock market rally and generally upbeat economic data.

Traders in the fed funds futures market are assigning just a 6% probability to a December hike and a 12% chance of an increase in January, according to the CME Group's FedWatch calculations. The tool also is pointing to the first cut in May, though the odds of that have lessened a bit over the past week.

At their last meeting, which concluded Nov. 1, policymakers gave no indication they were contemplating cuts any time soon, according to minutes released last week.

—Jeff Cox

The rampant trader interest in short-term derivatives now has new room to grow following the listing of new options contracts by Nasdaq.

The exchange last week launched new two-week options contracts that expire on Wednesdays based on the following exchange traded products:

• United States Oil Fund (USO)
• United States Natural Gas Fund (UNG)
• SPDR Gold Shares (GLD)
• iShares Silver Trust (SLV)
• iShares 20+ year Treasury Bond ETF (TLT)

The contracts available for these products are still less varied than for major stock indexes, which have options expiring every day that enable the "zero-day to expiration" trading that has boomed in recent years.

— Jesse Pound

Since 1945, the S&P 500 has underperformed in the trading week following the Thanksgiving holiday, according to Bespoke Investment. During this period, the S&P 500's median gain has been 0.19%, with positive returns 55% of the time, compared to the 0.24% median gain for all five trading day periods.

"In years when the S&P 500 was already up at least 15% YTD, the median gain was an even weaker 0.16%. Over the long term, it appears as though bulls come out of the Thanksgiving holiday season a little hungover and sluggish following all the festivities," the firm wrote in a Monday note.

However, market performance in the post-Thanksgiving week has become stronger over the last 20 years. The broad market index's median gain during the week after Thanksgiving has been 0.44%, according to the firm, with positive returns 70% of the time.

— Hakyung Kim

Oil settled slightly lower on Monday as Israel and Hamas agreed to extend their ceasefire agreement.

The Brent contract for January fell 60 cents, or .74%, to settle at $79.98 a barrel, while the West Texas Intermediate contract dropped 68 cents, or .9%, to settle at $74.86 a barrel.

Israel and Hamas agreed to extend a truce by another two days, according to Qatar. Oil had spiked in October on fears that the conflict would spread throughout the Middle East and disrupt production.

Traders are also weighing whether OPEC and its allies, OPEC+, will extend or deepen production cuts at a pivotal meeting scheduled for Thursday.

-- Spencer Kimball

The most popular place to put cash in 2023 has been, well, cash.

Cash-related investments such as money market funds and CDs have gathered $1.2 trillion in inflows this year, according to Bank of America. That easily dwarfed other options such as Treasurys ($186 billion), investment-grade bonds ($145 billion) and equities ($143 billion).

Money market mutual funds are currently holding a near-record $5.76 trillion, according to the Investment Company Institute.

—Jeff Cox

Buy-now-pay-later stock Affirm jumped more than 10% as shoppers scoured the internet for Cyber Monday deals.

The rally comes on the heels of Adobe data forecasting that usage of buy-now-pay-later options for shopping, known in short as BNPL, will hit an all-time high on Monday. Adobe expects BNPL to account for $782 million in online spending for the day, nearly 19% higher than Cyber Monday in 2022.

Shoppers may be flocking to BNPL options to provide more budgetary flexibility as inflation and the resumption of student loan payments pinch pocketbooks. Broadly speaking, Adobe is showing strength in online holiday shopping as consumers appear increasingly focused on finding value amid the changing economic landscape.

Other stocks tied to online shopping were also climbing in Monday's session. Shopify added more than 5%, while Amazon rose more than 1%.

— Alex Harring

Shares of iRobot sank more than 18% after the European Union's antitrust watchdog said that Amazon's $1.7 billion acquisition of the company raised competition concerns.

The European Commission said Monday in a statement that it notified Amazon of its "preliminary view that its proposed acquisition of iRobot may restrict competition in the market for robot vacuum cleaners." It first opened an in-depth probe into the purchase in July.

Amazon first announced plans to buy the robot vacuum cleaner maker in August 2022 for an all-cash deal valued at $61 a share.

— Annie Palmer, Samantha Subin

November has typically been a winning month for the Dow and S&P 500, but this one is shaping up to be particularly strong.

The blue-chip Dow is poised to finish November up 6.9%, while the broad S&P 500 is slated to end 8.7% higher. (Thursday's close concludes the trading month.)

That's far more than usual. By comparison, each index has gained a relatively modest 1.7% in the month when averaging the returns for every November between 1950 and 2021, according to the Stock Trader's Almanac.

November has historically been the best month of the year on average for the S&P 500 and second best for the Dow, per the Almanac's data.

— Alex Harring

More signs may be pointing towards a broader macroeconomic slowdown, but not the S&P 500's earnings potential, according to Citi.

In 2024, analyst Scott Chronert predicts that "more S&P 500 companies are expected to positively contribute to index-level growth, fewer are projected to be significant detractors, and underlying EPS growth variation is set to decline."

Chronert noted that few stocks are expected to see significant declines in their earnings per share numbers, as compared to both 2023 and the 5-year average prior to the pandemic. He added that the percentage of S&P 500 companies that are set to report positive year-over-year earnings growth is also set to trend higher next year.

"To us, the bottom falling out of S&P 500 EPS is a tail risk. A more resilient fundamental backdrop should support a higher equity floor even if sentiment and multiples sour," the analyst wrote.

— Lisa Kailai Han, Michael Bloom

Check out some of the companies making headlines in midday trading.

Foot Locker — The shoe-and-apparel retailer shed 1% on the back of a Citi downgrade to sell from neutral. Citi said Foot Locker is in a bad environment for staging a turnaround.

Carnival — Shares added 1% after being upgraded to buy from hold by Melius Research. The firm likes Carnival's transformation since CEO Josh Weinstein took the helm one year ago. Melius also believes the cruise industry is expected to be the most compelling setup in the travel sector heading into next year.

Crown Castle — The telecommunications stock jumped nearly 4% following an activist push for change at Crown Castle. Elliott Investment Management, which has a roughly $2 billion stake in Crown Castle, called for new executive and board leadership, as well as a strategic and operating review of its fiber business, according to a letter released Monday. The Wall Street Journal on Sunday first reported the news. Shares of Crown Castle are down 20% this year.

Read the full list here.

— Brian Evans

Energy was the S&P 500's largest-declining sector on Monday, falling 0.7% overall. Coterra Energy and APA both fell around 1.8%, followed by EQT down 1.6%.

Meanwhile, real estate and consumer staples were the only positive sectors in the broad market index. Real estate rose 0.4%, with Crown Castle jumping more than 4%. Consumer discretionary stocks were boosted by Cyber Monday shopping. Ecommerce platform Etsy rallied 4.6%, and Amazon gained 1.1%.

The utilities and consumer staples sector traded near the flatline.

— Hakyung Kim

Oil prices were choppy Monday as investors await an OPEC decision on production cuts later this week.

The Brent crude contract for January was down 15 cents, or .19%, at $80.43 a barrel, while the West Texas Intermediate contract for January rose 3 cents, or .04%, at $75.57 a barrel.

Oil futures have been teetering between positive and negative territory this morning.

The Organization of Petroleum Exporting Countries and its allies, OPEC+, will meet Thursday to discuss production targets on Thursday. The meeting was originally supposed to take place over the weekend, but OPEC rescheduled amid a dispute with Angola and Nigeria over output targets.

Oil briefly sold off in intraday trading Wednesday after the delay was announced, but subsequently recovered those losses.

— Spencer Kimball

New homes sold at a slower than expected pace in October while still showing improvement from a year ago, the Commerce Department reported Monday.

Sales of new single-family homes totaled a seasonally adjusted annual rate of 679,000, a 5.6% decline from September and below the Dow Jones forecast for 725,000. The September level saw a sharp downward revision to 719,000, some 40,000 lower than the initial estimate. October's total represented a 17.7% increase from the same period in 2022.

The department also said the median, or midpoint, sales price for a new home was $409,300, while the average was $487,000. Available inventory equated to 7.8 months of supply.

—Jeff Cox

Some of the factors that have propelled November's stock market rally now could start to work against it, economist Mohamed El-Erian said Monday.

"I do think that the consensus forecast right now is too optimistic about the global economy," El-Erian, the chief economist advisor at Allianz and president of Queens' College Cambridge, said during an appearance on CNBC's "Squawk Box."

In his view, the rally has been about "Goldilocks" economic data, lower oil prices and bond yields and the $5.8 trillion of cash on the sidelines, parked in money market accounts. The first three, he said, are likely to reverse in the days ahead, though the large amount of cash available should serve as a buffer.

"We're not talking about major sell-offs here. We're just talking about not repeating what has been an exceptional November," El-Erian said.

Adobe Analytics raised its forecast for Cyber Monday spending after robust holiday shopping online over the Thanksgiving weekend. It now predicts shoppers will spend between $12 billion and $12.4 billion today.

Adobe said online spending on Black Friday topped its predictions at $9.8 billion, up 7.5% year over year. Over Saturday and Sunday, shoppers rang up another $10.3 billion in purchases, or about 7.7% above last year's tally.

"An uncertain demand environment pushed retailers to deliver big discounts this season, while also fortifying their e-commerce services with flexible payment methods, better personalization, and enhanced mobile functionality" said Vivek Pandya, lead analyst, Adobe Digital Insights, in an email. "Consumers have taken note and spent at record rates during the big shopping days, despite dealing with rising costs in other parts of their lives."

The rosy outlook for online spending was lifting shares of Shopify, which was up more than 4% in trading, setting a fresh 52-week high.

—Christina Cheddar Berk

Stocks opened lower on Monday.

The Dow Jones Industrial Average dipped 18 points, or less than 0.1%. The S&P 500 and Nasdaq Composite lost about 0.2%.

— Pia Singh

The dollar index is on track to post its biggest loss of the year this month.

The index, which tracks the U.S. greenback against a basket of foreign currencies, has slid 3.2% since November began. If that holds through month's end, it would mark the worst monthly performance since November 2022, when the index dropped 5%.

— Alex Harring, Gina Francolla

GAM Investments' Niall Gallagher told Bloomberg that he's trimming his holdings in Novo Nordisk's stock by half because the stock's valuation has gotten too rich. While Gallagher doesn't expect any rivals to catch up with Novo and Eli Lilly in the weight loss drug market anytime soon, he told the news service "there's a lot of hype and it goes beyond just stock markets."

For months, there has been a ton of chatter about Novo's Ozempic and Wegovy and Lilly's Mounjaro and Zepbound. The drugs treat type 2 diabetes and help patients lose weight by copying hormones in the gut. Other health benefits have also been touted.

Gallagher doesn't doubt Novo has growth ahead of it, but shares are priced at nearly 33 times forward earnings. Compare that to the average health stock, which is trading at a price-to-earnings ratio of about 17.

—Christina Cheddar Berk

Online retail stocks rose in early morning trading during the Cyber Monday event. Amazon shares gained 0.7%, while Best Buy added 0.2%. Shares of Canadian e-commerce company Shopify popped 3.9%.

— Sarah Min

Check out the companies making headlines before the bell.

• Okta — The cybersecurity company fell 1.1% after Jefferies downgraded shares to market perform from outperform. Okta's security breach announced on Oct. 20 has significantly degraded the brand and lead to a lack of trust among its customers, according to Jefferies. 
• Teva Pharmaceutical — Shares gained 2.3% following an upgrade from UBS to buy from neutral. UBS cited the pharmaceutical company's strong brand pipeline and upcoming outcomes to two major clinical trials.
• Mondelez — Shares rose 1.1% after RBC upgraded the snack maker to outperform from sector perform, citing share gains, category growth and expanding retail footprint. 

The full list can be found here.

— Hakyung Kim

The Wall Street Journal reported that Elliott Management has accumulated a more than $2 billion stake in Crown Castle and plans to push for changes within the wireless-tower operator. Specifically, Elliott wants to approach the company on ways to boost the stock, the report said, citing sources.

Shares rose nearly 5% on the back of the report.

— Fred Imbert

European markets dipped at the start of the new trading week, though sector movements remained subdued.

Oil and gas stocks fell 0.8% as retail nudged 0.3% higher.

The Stoxx 600 index was 0.1% lower at 9:05 a.m. London time. The pan-European benchmark has climbed steadily through November and is on track for a monthly gain of more than 6%, according to LSEG data, its best month since January.

— Jenni Reid

The Beijing Stock Exchange has asked major shareholders of listed companies not to reduce holdings even if they are eligible to do so, Reuters reported.

Citing people familiar with the matter, Reuters said this was due to fears that such moves could "dull market excitement."

According to LSEG data, the Beijing Stock Exchange 50 Index has largely been on an uptrend since October, registering a one month gain of 44.72% and three month gain of 44.75%.

These gains were due to stocks rising on the back of supportive measures, Reuters reported.

The Beijing exchange and the China Securities Regulatory Commission did not immediately reply to Reuters' requests for comment.

— Lim Hui Jie, Reuters

Hong Kong-listed China property stocks slid on Monday, leading declines among other sectors on Monday.

Shares of property developers including Logan Group, China Vanke, Sunac and Longfor Group fell between 4% and 8%.

The Hang Seng Mainland Properties index, housing real estate firms, dropped 3.51%.

It was reported over the weekend that Beijing police was investigating debt-laded Chinese shadow bank Zhongzhi Enterprise Group.

Zhongzhi last week declared insolvency in a letter to its investors.  

China's CSI 300 index fell 1.19%, leading declines among major Asia markets.

— Shreyashi Sanyal

China's industrial profit continued to decline in November, but at its slowest pace in almost a year, according to government data.

The reading showed profits at industrial enterprises in China decreased 7.8% in the January-to-October period from a year earlier, declining at the slowest pace since December 2022.

The drop was smaller than the 9% decline recorded in September.

Data highlights China's uneven post-pandemic recovery and the need for more stimulus to boost market confidence.

China's CSI 300 index fell 0.75%, minutes after the open following the data release.

– Shreyashi Sanyal

Jun Ohta, group CEO of Sumitomo Mitsui Financial Group, passed away on Saturday at the age of 65, the Japanese financial conglomerate said.

SMFG announced on Monday that deputy president Toru Nakashima will take over Ohta's duties for the time being.

The company also added that it would be selecting a successor, and will announce the decision "in a timely manner."

— Lim Hui Jie

U.S. stock futures were modestly lower on Sunday evening.

Shortly after 6 p.m. ET, futures for the Nasdaq 100 were down about 0.2%. Futures for the S&P 500 and Dow Jones Industrial Average were off by about 0.1% each.

— Jesse Pound

Wall Street was broadly higher during the shortened Thanksgiving trading week. Here are the numbers for the major averages:

• The Dow gained 1.27% on the week, its fourth positive week in a row.
• The S&P 500 rose 1.00% on the week, its fourth positive week in a row
• The Nasdaq Composite added 0.89% on the week, its fourth positive week in a row
• The small cap Russell 2000 rose 0.54% on the week, which was its its second positive week in a row

— Jesse Pound, Christopher Hayes