Investing.com – Wall Street traded lower on Friday as the post-election rally began to fade on the last trading session in the week while investors digested a jump in consumer sentiment along with a reiteration by the Federal Reserve (Fed) vice chair that it was time to proceed with gradual removal of accommodative monetary policy.
At 11:33AM ET (16:33GMT), the Dow Jones lost 47 points, or 0.25%, the S&P 500 fell 12 points, or 0.53% while the tech-heavy Nasdaq Composite traded down 11 points, or 0.20%.
The preliminary publication of the data for November from the University of Michigan's Consumer Survey Center showed that consumer sentiment rose to 91.6 from 87.2 in the previous month. That was its highest reading since June 2016 and beat the consensus estimate.
The report also showed that inflation expectations both 12 months out and the five-year gauge rose to 2.7%, from the prior 2.4%.
The Fed will likely take note of the strong reading of consumer confidence along with the increase in price expectations as it contemplates the timing of its next rate hike.
However, the University of Michigan did indicate that the caveat may be in the fact that the survey was carried out prior to the results of the recent presidential elections.
Assumptions that President-elect Donald Trump will look to implement policies that accelerate inflation has been the theme since this week's election results, pushing the dollar and bond yields higher (the U.S. bond market is closed Friday for the Veterans’ Day holiday), adding to expectations for the Fed to return to policy normalization at the last meeting this year.
While not referring to outcome of the U.S. election, Fed vice chair Stanley Fischer reiterated on Friday that “the case for removing accommodation gradually is quite strong.”
With a little over a month to go, a rate hike at the December 13-14 meeting seemed highly likely with markets putting the odds at 81.1%, according to Investing.com's Fed Rate Monitor Tool.
On the company front, shares in Walt Disney Company (NYSE:DIS) bucked the downtrend in the Dow on Friday, leading the gains on the blue chip index, after entertainment giant promised earnings growth over the next two years.
NVIDIA Corporation (NASDAQ:NVDA) soared nearly 25% after registering its largest growth in revenue in more than 6 years and handily beating estimates. Amid the general downturn in tech shares on concerns that Trump could attempt to put an end to outsourcing, the good news from the graphic chipmaker pushed shares in AMD (NASDAQ:AMD) 5% higher.
Also in tech headlines, shares in Alibaba (NYSE:BABA) sank 3% as the sales growth rate on Single’s Day, the biggest day in China for online sales, slowed.
Meanwhile, oil prices slumped around 3% on Friday, as ongoing concerns over a global supply glut continued to weigh on the commodity.
OPEC’S own monthly report showed the cartel increasing output, supporting growing doubts that the cartel will manage to limit production to a significant degree when it meets in Vienna on November 30.
U.S. crude futures lost 2.98% to $43.83 by 11:35AM ET (16:35GMT), while Brent oil traded down 30.1% to $44.46.