Stock Market News: Energy Sector Grabs Top Spot For 2021

“The consumer price index rose 0.8% last month after surging 0.9% in October. The broad-based increase was led by gasoline prices, which rose 6.1%, matching October’s gain. With crude oil prices declining recently, gasoline prices have likely peaked.

"Food prices rose 0.7%. The cost of food at home increased 0.8%, driven by increases in the price of fruits and vegetables, meat and cereals and bakery products. It also cost more to eat away from home.

"In the 12 months through November, the CPI accelerated 6.8%. That was the biggest year-on-year rise since June 1982 and followed a 6.2% advance in October.”

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Other data this week showed there were 11 million job openings at the end of October and Americans quit jobs at near-record rates. The core CPI jumped 4.9% on a year-on-year basis, the largest rise since June 1991, after increasing 4.6% in the 12 months through October.

The Fed tracks the personal consumption expenditures (PCE) price index, excluding the volatile food and energy components, for its flexible 2% inflation target. The core PCE price index surged 4.1% in the 12 months through October, the most since January 1991. Data for November will be released later this month.” (Reuters)

Also from Reuters:

“Wall Street analysts have begun rolling out their predictions for U.S. equity markets in 2022. The benchmark S&P 500 index has risen nearly 25% so far this year. It closed at 4,701.21 on Wednesday.

Here is a summary of some analysts’ forecast for the index:

Morgan Stanley: “While earnings for the overall index remain durable, there will be greater dispersion of winners and losers and growth rates will slow materially… 2022 will be more about stocks than sectors or styles, in our view.”

Wells Fargo: “Persistent supply shortages and inflation pressures lead us to adjust the magnitudes of some 2022 targets, but we believe the global economy should still mark an above-average pace next year. More importantly, our tactical preferences for the next 6 to 18 months are nearly all unchanged.”

Goldman Sachs: “Decelerating economic growth, a tightening Fed, and rising real yields suggest investors should expect modestly below-average returns next year.” (Reuters)

“The holidays tend to make Americans very, very thirsty. And that’s a problem this year, with supply chain snarls hitting the beverage industry – from soda to energy drinks, booze to beer – especially hard. Things could get even tougher in the next couple months.

"While typical grocery categories are experiencing 5% to 10% of products out of stock right now, beverage shortages are higher, with around 13% missing from shelves. Shortages have been showing up in waters, iced teas and soft drinks, as well as beer, hard seltzer and canned cocktails.

"A shortage of bottles and cans is responsible for much of it, but trucking and shipping snarls, missing ingredients, labor woes and even freak weather are all contributing to shortages, leaving grocers scrambling to fill in the gaps. It’s just the latest example of ongoing food supply problems that have shown up in a variety of sectors, wreaking havoc on prices and contributing to the highest inflation in three decades.

"Freeman said the empty shelves reflect '“demand unlike what we’ve seen in recent history running headfirst into problems with access to ingredients and materials.”'

"The problems are certainly true for the world’s largest beverage company, Coca-Cola (NYSE:KO), whose chief executive James Quincey has said repeatedly that consumers will see sporadic shortages on grocery shelves through 2022.” (YahooFinance)