Beneath the adrenaline rush of November’s stock-market surge is an eerie calm that points to more gains for equities investors, at least through the end of the year. The S&P 500 Index posted an average daily move of 0.3% in either direction last week, its tamest swings in half a year, as the market lost some momentum toward the end of its second-best November since 1980. The Cboe Volatility Index, also known as the VIX, fell toward the year’s lowest levels Friday, and stocks rose after Federal Reserve Chair Jerome Powell gave his clearest signal yet that officials have finished raising interest rates.
“The market can work off overbought conditions by either declining price action or via time, and thus far, the S&P has digested the big advance by slowing down over time,” said Frank Cappelleri, founder of CappThesis LLC. “The slowdown after such a strong first half of November should be considered constructive.”