On Friday, the S&P 500 Index ($SPX) (SPY) closed +0.88% higher, the Dow Jones Industrials Index ($DOWI) (DIA) closed +0.38% higher, and the Nasdaq 100 Index ($IUXX) (QQQ) closed +1.31% higher. March E-mini S&P futures (ESH26) rose +0.87%, and March E-mini Nasdaq futures (NQH26) rose +1.28%.
Stock indices closed higher on Friday as a rally in cloud infrastructure stocks improved market sentiment and led the broader market. Oracle rose more than 7% after TikTok CEO Chew said his company has signed binding agreements to form a US joint venture owned by US investors including Oracle. Moreover, strength in chip makers on Friday helped lift the overall market.
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Friday’s US economic news was mixed for stocks after existing home sales hit a 9-month high in November, but the University of Michigan’s US December consumer sentiment index was revised unexpectedly lower.
Seasonal factors are bullish for stocks. Since 1928, the S&P 500 has risen 75% in the last two weeks of December, climbing an average of 1.3%, according to data from Citadel Securities.
Higher bond yields limited gains in stocks on Friday, as 10-year T-note yields rose +2 bp to 4.15%. 10-year Japanese government bond yields rose to a 26-year high of 2.025% after the BOJ lifted global bond yields on Friday to a 26-year high of 2.025% and said it would keep raising rates if its economic and price outlook is realized.
Existing home sales in the US rose +0.5% per cubic meter in November to a 9-month high of 4.13 million, though below expectations of 4.15 million.
The University of Michigan’s US December consumer sentiment index unexpectedly dropped by -0.4 to 52.9, weaker than expected to rise to 53.5.
The University of Michigan’s December 1-year inflation expectations unexpectedly rose to 4.2% from a previously reported 4.1%.
Upbeat comments from New York Fed President John Williams on Friday were supportive for stocks but negative for bonds, as he said some of the data we’re seeing is “quite encouraging” and he sees no sign of a sharp decline in the jobs data. He said he thinks U.S. GDP growth will be 1.5% to 1.75% this year, with growth accelerating next year, and “there’s no need to take further action on monetary policy right now, because I think the cuts we’ve made put us in a really good position.”
Stock market movements on Friday may be exaggerated and more volatile than usual due to the expiration of options, futures and derivatives during the quarterly phenomenon known as triple witching. The U.S. options market will have a record $7.1 trillion in estimated open interest at closing on Friday, according to Citigroup.
Markets are giving a 22% discount on the likelihood that the FOMC will cut the fed funds target range by 25 bp at the next FOMC meeting on January 27-28.
Foreign stock markets closed with gains on Friday. Euro Stoxx 50 closed +0.32% higher. China’s Shanghai Composite climbed to a 1-week high and closed +0.36% higher. Japan’s Nikkei Stock 225 closed up +1.03%.
interest rates
March 10-year T-notes (ZNH6) closed below -8 ticks on Friday. The 10-year T-note yield rose +2.7bp to 4.149%. Friday’s stock rally reduced safe-haven demand for government debt securities and put pressure on T-notes. Additionally, sharp comments from New York Fed Chairman John Williams weighed down T-note prices when he said some of the data we are seeing is “very encouraging” and he sees no sign of a sharp decline in the jobs data. Additionally, T-notes had negative carryover from Friday’s jump in the Japanese government 10-year bond yield to a 26-year high of 2.025%.
The rising yield curve is also bearish for T-note prices. Sharp trading occurs when bond investors buy short-term government debt and sell long-term debt. The yield curve has steepened since last Wednesday’s FOMC meeting, when the Fed said it would begin buying up to $40 billion per month of short-term T-bills to boost liquidity in the financial system. Long-term Treasury securities are also under pressure from concerns about inflation and the Fed’s independence.
European government bond yields rose on Friday. The 10-year German Bund yield hit a 9-month high of 2.899% and ended +4.6bp at 2.895%. 10-year UK gilt yields rose +4.3bp to 4.524%.
German November PPI fell -2.3% year-on-year, weaker than expected -2.2% year-on-year and the fastest pace of decline in 20 months.
The German GfK consumer confidence index unexpectedly fell -3.5 points to a 1.75-year low of -26.9, weaker than expectations for a rise of -23.0.
ECB Governing Council member Pierre Wunsch said the ECB could leave interest rates untouched for some time if it keeps the forecast in its latest outlook on the economy and prices.
Retail sales of ex-auto fuel in the UK unexpectedly fell by -0.2% per cubic meter in November, weaker than expectations for a rise of +0.1% per cubic metre.
The swaps are giving a discount of 0% to a -25bp rate cut by the ECB at its next policy meeting on February 5.
US Stock Movers
Cloud infrastructure stocks rose sharply on Friday, recovering from a recent selloff caused by financing concerns in the AI supply chain. CoreWeave (CRWV) closed up +23%, Applied Digital (APLD) closed up +16%, and Nebius Group NV (NBIS) closed up more than +15%. Additionally, Oracle (ORCL) closed up more than +7%.
Chip stocks are moving higher today, which is a supportive factor for the overall market. On the Nasdaq 100, Micron Technology (MU) closed up +7% and Advanced Micro Devices (AMD) closed up more than +6%. Additionally, Lam Research (LRCX) closed up more than +4%, and Nvidia (NVDA) closed up more than +3% and led the Dow Jones Industrials. Additionally, Broadcom (AVGO) closed up more than +3%, and KLA Corp (KLAC), NXP Semiconductors NV (NXPI), Intel (INTC), Microchip Technology (MCHP), Applied Materials (AMAT), ASML Holding NV (ASML), and GlobalFoundries (GFS) closed up more than +1%.
Cryptocurrency-exposed stocks moved higher on Friday as Bitcoin (^BTCUSD) surged more than +2%. Riot Platforms (RIOT) closed up more than +8%, and Galaxy Digital Holdings (GLXY) closed up more than +6%. Additionally, Mara Holdings (MARA) closed up more than +4%, and Strategy& (MSTR) closed up more than +3%. Additionally, Coinbase Global (COIN) closed up more than +2%.
WhiteFiber Inc. (WYFI) closed more than +18% after announcing a 10-year 40 MW co-location agreement between its subsidiary Anovum Data Centers Corp. and Enscale Global Holdings, representing approximately $865 million in contracted revenues.
Carnival (CCL) closed up more than +9%, leading cruise stocks and leading the S&P 500, after reporting adjusted EPS of 34 cents in Q2, better than the consensus of 24 cents. Additionally, Norwegian Cruise Line Holdings (NCLH) closed up more than +6%, and Royal Caribbean Cruises Ltd. (RCL) closed up more than +2%.
FactSet Research Systems (FDS) closed up more than +5% after Huber Research Partners double-upgraded the stock from underweight to overweight with a price target of $326.
Amphenol (APH) closed up more than +4% after Truist Securities raised its price target on the stock from $147 to $180.
Cummins Inc. (CMI) closed up more than +1% after Barclays upgraded the stock from Equal Weight to Overweight with a price target of $546.
Generac Holdings (GNRC) closed up more than +1% after Wells Fargo Securities upgraded the stock from equal weight to overweight with a price target of $195.
Lamb Weston Holdings (LW) closed down more than -25% among the losers in the S&P 500 after forecasting full-year net sales of $6.35 billion to $6.55 billion, below the consensus midpoint of $6.52 billion.
Nike (NKE) closed down more than -10% to lead losses in the Dow Jones Industrials after forecasting a low single-digit decline in third-quarter revenue and a decline of about 175 to 225 basis points in gross margin amid continued weakness in China.
KB Home (KBH) closed down more than -8% after reporting fourth-quarter EPS of $1.55, weaker than the $1.79 consensus, and estimating 2026 housing revenue of $5.10 billion to $6.10 billion, below the consensus midpoint of $5.83 billion, leading the homebuilder to decline. Additionally, DR Horton (DHI) closed down more than -1%, and PulteGroup (PHM) closed down more than -1%.
KBR Inc. (KBR) closed down more than -5% after Truist Securities lowered its price target on the stock from $62 to $50.
Conagra Brands (CAG) closed down more than -2% after reporting organic sales fell -3% in the second quarter, a bigger than expected decline of -2.42%.
Lyft Inc (LYFT) closed down more than -2% after Wedbush Securities downgraded the stock from Neutral to Underperform with a price target of $16.
Paychex (PAYX) closed down more than -1% after BMO Capital Markets said the company’s second-quarter earnings indicated a “fine quarter,” but management-solutions growth remained soft.
Earnings Report(12/22/2025)
Barnes & Noble Education Inc. (BNED) and Resolve AI PLC (RZLV).
On the date of publication, Rich Asplund did not have (directly or indirectly) any positions in any securities mentioned in this article. All information and data in this article is for informational purposes only. Please see the Barchart Disclosure Policy here for more information.
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