The Post-Election Market Rally Is Slowing

The US stock market  hit record highs over the last week but then stalled out on Wednesday, coming to a halt as the post-election momentum started to wear off.

As the market closed down for the day on Wednesday, the Dow Jones was up just 0.11%, with the Nasdaq down by 0.26%. The S&P 500 was likewise low, with a gain of just 0.02%. These were muted numbers compared to what we say over the last week, since the election results started to come in. You can read more about that here.

Once Trump’s victory seemed evident, the stock market climbed quickly and stayed elevated day after day, with record highs being achieved across the board. We knew the bull run would have to finish eventually, and it looks like Wednesday may have been the last day of that run.

The market was also elevated due to another Fed interest rate cut. This is the second cut this year and a strong indicator of the Federal Reserve;’ confidence in declining inflation.

What to Expect from the Market Now

We should see a much more normal level of market activity now, as Wednesday’s trading was mixed for the first time since the election. Thursday trading is looking to open slowly, and we may see some of that loss of momentum slip over into the cryptocurrency market as well.

October inflation data showed mixed results too, with the consumer price index climbing by 2.6%. These numbers should not be poor enough to stop another Fed interest rate cut in the near future. The expectation is that the next cut will happen in December. When that occurs, we expect the market to surge again, though far more briefly than what we saw after the election.

One of the big success stories this week comes from Disney (DIS). They beat earnings expectations for the quarter and their stock climbed 1.71% on Wednesday, with the exception that the stock will continue to climb today.

Dollar Tree (DLTR) is one of the surprise winners this week, with a gain of 4.63% in premarket trading. The company just announced a change in management, switching some of its leaders around and replacing the CEO after reports of poor health. More details can be found here on the company’s website.