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Stock futures slide to start Thanksgiving week; Disney rose 9%

Stock futures slide to start Thanksgiving week; Disney rose 9%

Stock futures fell on Monday ahead of another batch of retail earnings to kick off a shortened Thanksgiving week.

Dow Jones Industrial Average futures fell 76 points, or 0.23%. S&P 500 and Nasdaq 100 futures were down 0.55% and 0.78%, respectively.

Disney bucked the negative trend but has since rallied more than 8% The media giant has announced that Bob Iger will return as CEO.

Investors reflected on the strength of the bear market rally that began earlier in the month with the consumer price index reading in October and was somewhat fueled by last week’s wholesale price reading.

Last week, traders were caught off guard by messages from Federal Reserve officials, who were less impressed by the numbers and re-evaluated their optimism about the possibility of inflation slowing. The market will be more receptive to Fedspeak on Tuesday when Cleveland Fed President Loretta Mester and St. Louis Fed President James Bullard speak.

Yardeni Research’s Ed Yardeni said he thinks the Oct. 12 low was a low and the S&P 500 could rise to 4,300 by the end of the year, he told CNBC on Friday night’s “Closing Call: Overtime.” The benchmark index is currently at 3,965.34.

“The big change in the market is the stability of the economy, which has been great,” he said. “Everyone is debating whether we’re going to have a soft landing or a hard landing – at this point there is no landing. The consumer hasn’t gotten the memo about the recession and they’re continuing to spend.”

Retail sales rose in October, but at the corporate level, Target reported a slowdown in demand and Amazon announced it would cut 10,000 jobs, but Home Depot and Walmart reported strong results.

“Retail stocks will be in the top three in November, the bottom three in December and the middle of the pack in January, despite the holiday season spending,” Liz Young, chief investment strategist at SoFi, said in a note this weekend.

“Seasonality occurs in market analysis and has some predictive power. But the power of the economic cycle is stronger regardless of the time of year,” he added. “With 375 basis points of Fed rate hikes so far, the yield curve inverted, rising inflation and commodity prices still part of the conversation, we can all conclude that we are late in the economic cycle.”

This week, short of the Thanksgiving holiday, investors are dealing with a different set of retail earnings. Best Buy, Nordstrom, Dick’s Sporting Goods and Dollar Tree are among the companies on deck.

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