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Stocks climbed for a second straight day Thursday after President Donald Trump took a fresh batch of European tariffs and a Greenland takeover off the table. Market participants also sifted through an onslaught of economic data and blue-chip earnings reports.
On Wednesday, President Trump told world leaders at the World Economic Forum in Davos, Switzerland, that he would not use “excessive strength and force” to annex Greenland.
He also said via a Truth Social post that he would not implement new tariffs on several European nations after reaching a “framework of a future deal” on Greenland with NATO Secretary General Mark Rutte.
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The main equity indexes surged more than 1% across the board in reaction and continued this upside today. At the close, the blue-chip Dow Jones Industrial Average was 0.6% higher at 49,384, the broader S&P 500 had gained 0.6% to 6,913, and the tech-heavy Nasdaq Composite rose 0.9% to 23,436.
PCE data does little to shift the rate-cut needle
Wall Street was also tuned into the latest inflation data, which arrived just ahead of next week’s Federal Reserve meeting.
Ahead of the opening bell, the Bureau of Economic Analysis said the Personal Consumption Expenditures (PCE) Price Index was up 0.2% on a monthly basis in both October and November, and was 2.8% higher on an annual basis in November.
The two-months’ worth of delayed PCE data, which is the Fed’s preferred inflation measure, was batched together due to the government shutdown and arrived in line with economists’ expectations.
The report also showed that personal income rose 0.3% in November, while spending increased 0.5%.
“Inflation, income, and expenditure numbers for November came in largely as expected,” says Scott Helfstein, head of investment strategy at Global X. “Income growth was a little below expectations, but everything else was spot on. We still think that fundamentals are good and the Fed is likely to cut two or three times this year.”
However, it’s unlikely that the Fed will cut rates when it concludes its January policy meeting next Wednesday. According to CME Group FedWatch, futures traders are pricing in a 95% chance the central bank keeps the federal funds rate unchanged this time around. Betting odds are for the first quarter-point rate cut of 2026 to come at the June gathering.
P&G pops after earnings, $10 billion dividend plan
In single-stock news, Procter & Gamble (PG) was in focus after the consumer products giant reported higher-than-expected fiscal second-quarter earnings, but fell short on revenue.
P&G also lowered its full-year net earnings-per-share outlook due to restructuring charges, and now expects growth to be in the 1% to 6% range.
Additionally, the company said it is committed to paying out $10 billion in dividends this fiscal year, up from the $9.9 billion it paid in fiscal 2025. PG remains one of the best dividend stocks for dependable dividend growth, having raised its payout for 69 straight years.
PG rose 2.6% today, making it one of the best-performing Dow Jones stocks.
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The Magnificent 7 stock is down more than 18% since its last turn on the earnings stage in late October, but Jefferies analyst Brent Thill says there are several reasons to buy any pullbacks in the communication services stock.
For one, it’s trading at an attractive valuation relative to fellow Mag 7 stock Alphabet (GOOGL), which “creates meaningful upside” if concerns around margin pressures, CapEx spending and artificial intelligence execution are put to rest.
Thill also believes that Meta’s leverage of generative AI to power its core flywheel, which converts user engagement across its suite of apps, will support ongoing growth.
The analyst has a Buy rating on Meta and says it’s a top pick. His price target of $910 represents implied upside of nearly 41% to current levels.
