Closing Recap

Tuesday, December 23, 2025

U.S. stocks and Treasury yields climb following a stronger than expected Q3 prelim GDP reading, as the US economy rose at an annualized rate of 4.3% from July through September (inflation adjusted), topping expectations of 3.3% and above the 3.8% growth in Q2 – the best quarter for GDP growth since Q3’23 when the economy expanded by 4.7%. With today’s gains, the S&P has risen 4 straight days heading into Christmas Eve and is nearing its all-time intraday high of 6,920.34 on October 29^th as momentum remains to the upside. The CBOE Volatility index, or fear index (VIX) held made new 52-week lows, falling below the 14 level as stocks edged higher all day (down from 26 just a month ago). After a $2.4 trillion balance-sheet reduction, the Fed has flipped the switch. QT is over, QE is back (but don’t call it QE). The Fed is printing money and expanding its balance sheet once again. The Fed started cutting rates in Sep 2024 with the 30-year yield below 4%…but while they have cut 175 bps…the 30-year is above 4.8% (hmmm)! Still, major US stock markets are all near their record highs heading into the New Year, on pace for an 8^th straight month of gains for the Nasdaq and S&P 500 and a 3^rd year of strong gains. Interesting stats: the Santa Claus” rally (last 5 trading days of the year plus the first two of next), per the Stock Almanac the S&P is up 76% of the time over that stretch with an average gain of 1.3%. @RyanDetrick noted on “X”, “The official Santa Claus Rally period starts on Wednesday. Santa hasn’t come for two years in a row, but he’s never missed three years in a row. And there is no 7-day period that is more likely to be higher than these 7 days (77.3%).”

• On GDP inflation data, US advance Q3 GDP deflator +3.7%, hotter than the consensus +2.7% while US advance Q3 PCE price index +2.8% (in-line with consensus +2.8%) and US advance Q3 core PCE +2.9% (in-line with consensus +2.9%)
• US Oct Durables orders fell -2.2% (vs. consensus -1.5%) and vs Sept +0.7% (prev +0.5%); Oct Durables ex-transportation orders +0.2% (cons +0.3%) vs Sept +0.7% (prev +0.6%); U.S. Oct Durables ex-defense orders -1.5% vs Sept +0.1%.
• U.S. Oct Gen. Machinery orders +0.8%, electrical Equipment -1.5%, Defense Aircraft/parts -32.4%; Oct nondefense cap orders ex-aircraft +0.5%, (cons +0.4%) vs Sept +1.1% (prev +0.9%); Oct Durables shipments +0.6% vs Sept +0.1%; Oct nondefense cap shipments ex-aircraft +0.7% vs Sept +1.2%.
• November Industrial Production climbs +0.2% M/m, slightly above the consensus est. +0.1% while the U.S. Capacity Utilization rate actual 76.0% vs 75.9% previous and est 75.9%.
• December Consumer Confidence index 89.1 below consensus 91.0 and vs Nov revised 92.9 (previous 88.7), while Present Situation: 116.8 (prev 126.9) and expectations: 70.7 (prev 63.2).
• Richmond Fed composite manufacturing index -7 in Dec vs -15 in November, Richmond Fed manufacturing shipments index -11 in Dec vs -14 in November and services revenues index -6 in Dec vs -4 in November.

• February gold prices rose $36.30 or 0.8% to settle at $4,505.70 an ounce (off earlier record intraday high of $4.530.80). Gold continued its ascent, hitting another fresh record high above $4,500 an ounce, the 50th instance of a record-breaking session in 2025 as the latest leg higher extends a YTD rally of approximately 70% as the metal tracks its strongest annual performance since 1979. Silver is even more impressive this year, surging above $70 and then $71 an ounce for the first time for its highest level on record and tracking a more than 140% gain this year (and up 8 straight months) and its best year since 1979. Palladium and platinum also surged in precious metals. It wasn’t just precious metals as copper prices also hit a record high amid a surge in commodity prices as the dollar fell.
• The dollar index (DXY) slips -0.2%, ending just above the 98 level in broad selling vs. the greenback on expectations of an easier interest rate cycle ahead by the Fed. The U.S. Dollar continues losses against Swiss franc and hits three-month low, falling over -0.5% at 0.7873 francs; against the Japanese yen, the USD/JPY slipped from 157.05 in Asia to ~156.00 overnight. The euro extended Monday’s gains to 1.1800 against the buck before paring gains. The British Pound rose to 3-month highs above 1.35 vs. the dollar, its highest level since October 1, extending last week’s gains and putting it on track for its best month out of the last four. The pound is up over 2% so far in December and on track to end 2025 about 8% higher. Lastly the Canadian dollar his a 5-month high at 1.3690 per U.S. dollar, or 73.05 U.S. cents.
• The U.S. sells $70B 5-year notes at high yield 3.747%, with bid-to-cover ratio 2.35, and Primary dealers take 8.84% of U.S. 5-year notes sale, direct 31.65% and indirect 59.51%. Bitcoin

• In Autos: AMZN’s Autonomous Car maker subsidiary Zoox recalled more than 300 vehicles after it found a software error that may increase the risk of a crash. The recall was initially prompted by an incident on Aug. 26. Barclays noted CCC Intelligent Solutions published Crash Course for Q4, which highlights collision repair industry trends. Rising total loss rates are positive for CPRT, although this is offset by still elevated uninsured rates. For LKQ, avg. part costs have increased which could help pricing, but dependent on demand.

• In Solar: Heading into 2026, Roth Capital says they are bullish US utility-scale solar and see a transition year for US resi solar as 25D expires. For resi solar, Roth sees H1’26 as the trough while the industry adjusts to a primarily TPO-driven market, but it sees potential for a promising H2’26 as interest rates come down, utility rates continue to increase, and prepaid lease (PPL) and its variants ramp. Roth’s top picks for 2026 include NXT, TE, RUN, and ENPH.
• In Power news: CIFR announced the acquisition of a 200-megawatt ("MW") site in Ohio, called "Ulysses." The transaction includes 195 acres of land and secured capacity from AEP Ohio. NNE congratulates its commercial partner LIS Technologies Inc. on LIST’s receipt of a key Radioactive Material License from the State of Tennessee for its state-of-the-art Demo Test Loop Facility being developed on the historic K-25 site in Oak Ridge, Tennessee. GEV won a POWERGRID contract to refurbish India’s 1,000 MW Chandrapur back-to-back HVDC link, connecting the western and southern grids. WULF secures zoning approval for NY data center. TeraWulf secured a critical regulatory approval on Monday night when officials in Lansing, New York, voted to classify its Lake Cayuga site for permitted industrial use.

• In Lending: CNBC reported the Trump administration to start seizing pay of defaulted student loan borrowers in January.

• IVVD said it has started late-stage clinical trial to test its experimental COVID-19 antibody, VYD2311, as a preventive treatment for the disease; the study will enroll 1,770 adults and teens; compare single vs monthly shots to placebo, says co; the co says the goal is to offer vaccine alternative for high-risk people seeking protection.
• JNJ was ordered to pay over $1.5B in a lawsuit that alleged the company’s talc-based personal products gave a Maryland woman cancer. The verdict is the largest ever returned against Johnson & Johnson for a single plaintiff, according to lawyers. Johnson & Johnson said it would appeal the verdict, which it called "egregious and patently unconstitutional."
• RVPH said the FDA recommended a second Phase 3 clinical trial for brilaroxazine in patients with schizophrenia to, among other things, generate additional efficacy data and expand the safety dataset. Subject to sufficient financing, Reviva plans to initiate the RECOVER-2 Phase 3 trial in the first half of 2026.
• SAVA says it will pay $31.25M for complete settlement and release of all claims; to resolve litigation filed in US district court in Texas.
• In Managed care (UNH, CNC, HUM, ELV, CI, MOH), President Trump said last night meeting health insurers this week, wants to tell big 14 health ins firms to cut rates; auto/home insurance rates have also gone up.

• PSN said it secures Missile Defense Agency’s SHIELD contract, with a ceiling value of $151 billion; contract designed to accelerate delivery of advanced capabilities to war fighters with increased speed and agility
• Space/Drone stocks RKLB, LUNR, ASTS, RDW shares take a breather after a strong 3-day rally.
• Drone stocks generally higher after Needham said, "When combined with the $1B Drone Dominance initiative and the now signed FY26 NDAA, Needham thinks the regulatory framework sets the stage for record setting unmanned procurement activity in 2026. AVAV $450; DPRO $14; ONDS $12; RCAR $12; UMAC $20 PT.
• ZIM shares rallied after saying it was evaluating buyout proposals from multiple parties; noted their Board has rejected revised proposal from entity owned by CEO Eli Glickman, and Rami Ungar citing undervaluation; the company says its strategic review announced last month is in advanced stage.

• NOW agreed to acquire cybersecurity startup Armis for about $7.75 billion in cash in a move intended to take advantage of growing demand for AI security.
• MRVL was added as a positive catalyst watch into CES at Citigroup saying recent mgmt meetings reinforced positive conviction in Citi’s core thesis of accelerating Y/Y sales growth in 2026/27 driven by Ai data Centers.