On Wednesday, US benchmark equity indexes experienced a decline as traders digested recent economic indicators ahead of the Thanksgiving holiday. Consumer spending growth witnessed a slowdown, in line with expectations for October. Additionally, the Federal Reserve's preferred inflation metric showed signs of acceleration on an annual basis, as revealed by government data. TD Economics remarked, "Today's report underscores the ongoing resilience of US consumers with a large income gain and solid consumer spending in October.
On the flip side, inflation has also remained firm, chipping away at the real gains." The likelihood of a 25 basis points cut to the Federal Open Market Committee's benchmark lending rate next month surged to 70% on Wednesday, a rise from Tuesday's 59%. Meanwhile, the probability of rates holding steady at 4.5% to 4.75% diminished to 30% from previous levels of 41%. Crude oil prices saw slight declines, with January West Texas Intermediate settling down at $68.72 per barrel and January Brent crude, the international benchmark, also down at $72.76.
This came despite a report highlighting a decrease in U.S. oil inventories last week. OPEC+ is set to meet over the weekend to review its strategy regarding the potential reinstatement of 2.2 million barrels per day in production cuts. In corporate news, Walt Disney announced its agreement to pay $43.3 million to resolve a lawsuit claiming that its female employees in California were underpaid by $150 million compared to their male colleagues over an eight-year timeline.
Following the settlement news, Disney shares increased by 1.9%. Conversely, Dell Technologies witnessed a significant drop of 12% in its shares after reporting disappointing revenue figures for its fiscal Q3. The results were overshadowed by a slump within its client solutions division, leading to cautious guidance that Morgan Stanley labeled as disappointing for the market..