Closing Recap

Thursday, December 04, 2025

U.S. stocks finished mixed in another choppy trading day as Wall Street awaits next week’s FOMC policy meeting. Strong returns again for some interest rate sensitive sectors, high dividend paying stocks and Smallcaps with the Russell 2000 rising around 1% after jumping about 2% the day prior, as investors raise their bets the FOMC will cut interest rates by 25 bps at next week’s meeting. Markets are pricing in an 87% chance the central bank will cut rates by 25 basis points this month, up from around 68.6% a month ago. Global shares edged up yesterday after data showed employment is slowing (ADP private payrolls), though todays jobless claims showed strength in the jobs market. The dollar rebounded, snapping its 9-day losing streak while Treasury yields rose. Industrials and Communications advanced while Healthcare, Staples and Materials lagged.  Volumes still remain light (all week) ahead of tomorrow’s PCE inflation data. In weekly sentiment data: 1) The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was +13.5% vs -10.7% last week. Bulls rise to 44.3% from 32%, Neutrals drop to 24.9% from 25.3%, Bears fall to 30.8% from 42.7%. 2) This week’s NAAIM Exposure Index rose to 98.57 from last week’s 89.92 – highest since 10/29 Reading of 100.83 which was the highest since 7-3-24 – 2025 trough from 4-16 of 35.16 – Last Quarter Average (Q3) of 86.63.

• Sept Factory orders +0.2% below consensus +0.5% and vs Aug +1.3%; Sept Factory orders ex-transportation +0.2% vs Aug -0.1% (prev +0.1%), Sept Factory orders ex-defense unchanged vs Aug +0.7%. September computers/electronics products orders +0.5%, vs Aug -1.1% and nondurables orders -0.1% vs Aug -0.4%; U.S. Sept inventories/shipments ratio 1.56 months’ worth vs Aug 1.56 months.

• U.S. Treasury yields rose, snapping a three-day decline, as investors stepped back from bond purchases and consolidated positions ahead of next week’s Federal Reserve meeting, where the central bank is widely expected to deliver a third consecutive rate cut. The 10-year yield rose 5bps back near 4.11%. Bitcoin prices plunged briefly with the roll in stocks, down as much as -3% at $91,000, but rebounded as well back above $92,000 late day.
• February gold prices rose $10.50 or 0.25% to settle at $4,243 an ounce. Oil prices rose with WTI crude up +40.72 or 1.22% to settle at $59.67 per barrel while Brent Crude futures settle at $63.26/bbl, up $0.59, or 0.94% on investors’ expectations for the Federal Reserve to cut interest rates, while stalled Ukraine peace talks tempered expectations of a deal restoring Russian oil flows. U.S. crude futures briefly rose more than $1 a barrel earlier in the session as global shares rose.

• Apparel & Accessories: CURV shares fell after reported Q3 EPS loss of ($0.06), below consensus of ($0.02) from weaker sales due to an execution miss on tops and Associated markdowns and mgmt lowered F25 guidance to net sales of $995M-$1.002B (from $1.015-1.030B) and $59-62mm adj. EBITDA (from $80-90mm).
• In Hardline/Broadline: COST reported US comps were +5.8% (ex-fuel/FX) in November and +5.9% in 1QFY26, while total comps (ex-fuel/FX) were +6.4% in Nov. and +6.4% in Q1; Net sales for Q1 were $65.98B. PVH reported a top and bottom line beat for Q3 but shares declined after guiding Q4 revs up low-single-digits vs est +3.7% and adj EPS $3.20-3.35 vs est $3.61; TLYS Q3 total net sales decreased -2.7%, but comp sales grew 2.0%; Q3 gross profit improved to 30.5% of net sales from 25.9% y/y while net loss improved to $1.4M from $12.9M y/y; guides Q4 revs $146M-$151M and anticipates Q4 product margin improvement of 300 to 350 basis points.
• In Footwear: GCO shares tumble post results/guidance as Q3 adj EPS $0.79 missed the $0.88 estimate while cutting its FY26 profit and sales outlook on weaker footwear traffic and consumer spending patterns; now sees FY26 sales to grow about 2% (vs. prior view 3%-4%) and comparable sales about 3% (down from prior 4%-5%) and sees year EPS around $0.95, below prior view $1.30-$1.70.
• In Food & Beverages: HSY was upgraded to Hold in resumption of coverage saying the company has navigated cocoa cost pressures through pricing, innovation, cost savings and shifting towards salty growth vectors. Meanwhile, ’26 cocoa futures have fallen ~34% YTD to ~$5,500 and are projected to hold near level through ’27. HRL posted mixed Q4 with EPS beat but slight sales miss while expects FY2026 adj EPS between $1.43 and $1.51, with the midpoint above analysts’ average estimate of $1.45. CPB shares dropped below $30 per share, on track for lowest close since 2009. In grocers, KR shares tumbled following quarterly results.

• In Energy: PBR and SHEL secured two offshore areas in Brazil’s Mero and Atapu fields in an oil auction held on Thursday. The consortium, the auction’s sole bidder, made offers of 7.79 billion reais ($1.47B) for the Mero area, about 2% above the minimum price, and 1 billion reais for the Atapu area, 16% above.
• In Multi Industry: PNR was downgraded to Equal Weight from Overweight at Barclays in multi industry 2026 outlook saying further positive surprises on the company’s margin are less likely going forward given the absolute margin heights reached in the pool segment; also said CARR, GEV, LII, NVT, RAL, ROK screen quite attractively; ALLE, ETN, ITW, OTIS, PNR, ROP less so. Subdued investor expectations ex-Datacenter may help yield stronger rel. price performance in ’26, after a rather dreary ’25.
• In Transports: LSTR declares special one-time dividend of $2.00 per share. ALK cuts its Q4 adj EPS to $0.10 vs. original guide of at least $0.40 per share; several transitory headwinds totaling approximately $0.55-0.60 per share impacted the quarter, including: an internal IT and Cloud service provider outage ($0.25), lost revenue due to the government shutdown ($0.15), higher fuel costs ($0.15) and a higher book tax rate for the quarter.
• In Industrials: Goldman Sachs said NVT, MIR, LII all positioned to benefit from powerful secular trends such as electrification, power load growth, and Nuclear energy expansion. NVT has over 75% of its portfolio aligned with these trends, with significant exposure to infrastructure (data Centers and power Utilities) and is expanding its liquid cooling capacity eightfold; MIR is experiencing strong momentum in Nuclear, driven by commercial Nuclear announcements and expects double-digit Nuclear power growth in FY25. LII maintains a positive long-term outlook, focusing on growth initiatives like heat pumps and market expansion.
• In Aerospace & Defense: another sector with broad strength today was space/drone stocks with ASTS, LUNR, RKLB, RDW, PL, FLY, VOYG all outperforming this morning.

• In Canadian Banks: BMO posted 7% EPS beat vs. consensus, driven by both PTPP (4% better) and lower PCLs (8% lower). U.S. Banking showing good improvement. CM adj. EPS $2.21 vs consensus $2.08 as revs rose 14.5% year/year to CAD 7.58 bln vs the CAD 7.266 bln Consensus. CET1 ratio of 13.3%; TD beat. Adj. EPS $2.18 vs consensus $2.01. Capital markets are stronger & positive results out of wealth and insurance. RY strong quarter and increased ROE target are positives.

• CBIO said it has formed an exclusive partnership with China’s Kelun-Biotech to develop and market new cancer treatments while also raising $185 million from investors to fund clinical trials; CBIO says the deal gives Kelun-Biotech rights to co’s experimental drug CR-001 in Greater China.
• DNLI and RPRX announced a $275 million synthetic royalty funding agreement based on future net sales of tividenofusp alfa. The transaction is subject to various closing conditions, including Denali achieving U.S. FDA accelerated approval of tividenofusp alfa.
• HALO was downgraded to Sell from Neutral at Goldman Sachs saying a central debate is the long-term value of its Enhanze royalty model, which faces a substantial post-2030 revenue cliff as roughly 70% of royalties roll off contract between 2030-2035 and appears unlikely to be offset through typical business-development pacing.
• MBX shares declined after Goldman Sachs initiated at Sell and $18 PT saying the key issue for MBX will be whether its platform shows validity beyond canvuparatide, with upcoming Ph2a Post-Bariatric Hypoglycemia data in 2Q26 serving as the next major catalyst but likely falling short of meaningful differentiation.
• QURE shares declined after saying the FDA indicated that data from its Phase I/II studies of an investigational gene therapy for Huntington’s disease are unlikely to provide primary evidence to support a biologics license application submission.

• In Healthcare Technology: HQY reported a bottom-line beat with total HSA Assets of $34.4B increasing 15% Y/y, topping consensus expectations and further reduced its cash repricing risk with $2.25 Billion five-year T-bond hedged at 3.94%. HQY reported ~71% gross margins and adj. EBITDA margins of 44%, handily topping consensus. PHG shares fell after saying they continue to expect comparable sales growth to accelerate sequentially in 2026 towards a mid-single-digit percentage (in line with the performance for the last four consecutive quarters); CEO said a doubling of the organic sales growth rate was unlikely next year.
• In Tech Staffing: CCRN shares tumbled after announced the termination of its Agreement and Plan of Merger with Aya Holdings II Inc. In connection with the termination of the Merger Agreement, Aya Healthcare is required to pay Cross Country Healthcare a termination fee of $20 million

• In Paper &Packaging: PKG said it will permanently shut down the No. 2 paper machine (W2) and kraft pulping facilities at its Wallula, WA containerboard mill. PCA will continue to operate the No. 3 paper machine (W3) and recycled pulping facilities at the mill. These actions are estimated to result in pre-tax restructuring charges of approximately $205M, mostly recorded in Q4’25 and Q1’26; expect a reduction in headcount of about 200 jobs.

• In Internet: META shares jumped after Bloomberg reported the company is expected to cut its Metaverse budget by as much as 30% next year, a group that includes the company’s virtual worlds product Meta Horizon Worlds and its Quest virtual reality unit. Cost cuts of this size will most likely include layoffs as early as January.

• In Software: PATH reported better FQ3 ARR results and issued slightly higher FQ4 ARR guidance; the Q3 and FQ4 guidance implies net new ARR growth for the first time since FQ324 driven by improved execution; the company also noted customers adopting agentic solutions are creating pull-through of broader platform.
• IT Services & Consulting: CRM reported better-than-expected Q3 results (+11.4% cRPO vs 10%-11% guidance), billings of $8.7B beat consensus of $8.42B, up 13% y/y, and much better Q4 guidance, as the number of its Agentforce solution customers increased 50% Q/Q with 362 customer refueling credits versus just 3 in Q1 suggesting AF expansion is accelerating.
• In Cloud: SNOW delivered solid 3QFY26 results, raised FY26 revenue growth guidance (+28% YoY), and saw an acceleration in RPO growth (+37.5% YoY), but shares slipped after guidance for operating margins came in weaker than expected, implying that the just-reported great operating margins aren’t sustainable.
• In Robotics: AEVA announced that a leading European passenger Car manufacturer has officially chosen it as the exclusive LiDAR supplier for the company’s global production vehicle platform, supporting Level 3 automated driving. Start of production is expected in 2028. Canaccord says thinks that OEM is Mercedes-Benz.
• In Memory: Samsung Electronics and Sk Hynix reportedly both plan to raise their DRAM production growth targets for 2026. Samsung is focusing on standard DRAM such as DDR5, LPDDR5X, and GDDR7, while Sk Hynix intends to maintain its focus on HBM – Digitimes.
• For Semiconductors: Reuters reported this afternoon a bipartisan group of U.S. senators, including prominent Republican China Hawk Tom Cotton, on Thursday unveiled a Bill that would block the Trump administration from loosening rules that restrict Beijing’s access to artificial Intelligence chips for 2.5 years. The Bill, known as the SAFE CHIPS Act, was filed by Republican Senator Pete Ricketts and Democrat Chris Coons. It would require the Commerce Department to deny any license requests for buyers in China, Russia, Iran or North Korea to receive U.S. Ai chips more advanced than the ones they currently are allowed to obtain for 30 months.