US equity markets open holiday week with gains
US equity markets opened the shortened holiday week with gains, supported by lighter trading volumes and optimism for a year-end rally. Small-cap and value stocks led early advances, while technology sentiment improved following Micron’s strong earnings last week, easing concerns about an AI slowdown.
Broader tech recovered December losses, but cyclical sectors such as financials, energy, and materials outperformed by the end of the session.
Major US indices closed higher across the board, with the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all rising around 0.5%, despite below-average volumes ahead of early Christmas closures.
Commodities and fixed income update
Oil prices surged sharply as geopolitical tensions escalated following US action involving Venezuela, boosting energy equities. Precious metals also rallied, with gold and silver hitting fresh record highs, marking their strongest annual performance in decades. Meanwhile, US Treasury yields edged higher as economic data showed modest improvement but remained below expectations.
This trend signals improving market breadth beyond large-cap tech, reinforcing the case for a balanced and diversified equity strategy as investors look beyond year-end.
Global market snapshot
Here’s a quick look at how major global markets performed across regions.
Asian markets
Asian equities edged higher this morning, tracking Wall Street gains as tech shares rebounded and inflation concerns eased. Trading volumes were thin due to year-end holidays.
- China, Hong Kong, South Korea, and Singapore posted modest gains.
- Australia outperformed on stronger commodity prices.
- Japan remained mixed, with investors watching currency movements.
- US futures
US equity futures were mostly flat overnight after Monday’s strong start:
- Dow futures: +0.01%
- S&P 500 futures: +0.03%
- Nasdaq 100 futures: +0.1%
Technology stocks led after-hours gains, with Nvidia, Oracle, and Micron advancing as investors awaited Q3 GDP revisions and PCE price index updates.
European markets
European equities closed slightly lower on Monday:
- STOXX 50: -0.2%
- STOXX 600: -0.1%
Investor caution stemmed from global rate concerns, AI valuation worries, and renewed Ukraine-Russia tensions. Key decliners included AB InBev, Pernod Ricard, and Stellantis, impacted by tariffs and regulatory scrutiny.
Currency and commodity moves
The US dollar softened in thin holiday trading as investors awaited GDP and inflation data, allowing major currencies to firm slightly. The euro strengthened modestly against the dollar, though overall moves were limited by subdued volumes.
Crude oil prices edged lower on Tuesday:
- Brent: -0.16%
- WTI: -0.11%
Thin year-end volumes and cautious sentiment kept momentum muted.
Equities on the move
Several companies saw notable price action driven by analyst ratings, earnings, and strategic updates:
- Novo Nordisk: FDA approved its 25 mg oral semaglutide pill, Wegovy, for chronic weight management. Trials showed 16.6% average weight loss, strengthening Novo’s position against Eli Lilly in a global weight-loss market projected at $150 billion annually by 2035.
- Warner Bros Discovery: Considering an amended takeover bid from Paramount Skydance, backed by Larry Ellison’s $40 billion guarantee. Paramount’s $30-per-share all-cash offer values Warner at $108.4 billion, compared to Netflix’s $27.75-per-share bid. The reverse termination fee has been raised to $5.8 billion in the latest filing.
- Nvidia: Plans to ship H200 AI chips to Chinese clients before mid-February under new policy terms allowing sales with a 25% fee. Initial orders will use existing stock, with 5,000–10,000 modules, while new production is scheduled for 2026.
- ByteDance: Increasing AI investment to 160 billion yuan ($23 billion) in 2026, focusing on advanced semiconductors and overseas data centres despite US export restrictions. Spending may increase if restrictions ease.
- Microsoft: Wedbush projects strong AI-driven growth in 2026, citing Azure expansion and Copilot deployments. Maintains Outperform rating with a $625 target, estimating AI and cloud momentum could add $25 billion to revenue.
Upcoming data and events
Today’s US economic calendar includes:
- Q3 GDP second estimates
- Real consumer spending and corporate profits
- PCE price index
- October durable goods and industrial production
- New home sales (Sept–Nov)
- Consumer confidence
- US Treasury auctions and API crude oil stock changes
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