Closing Recap

Thursday, December 11, 2025

U.S. stock markets put on an impressive performance, with the S&P 500 recovering from sharp losses overnight to trade positive by midday and close at all-time highs (still hasn’t topped intraday record high), while the Russell 2000 Smallcap index hit another new all-time high as did the Dow Jones Industrial Average as the Fed 25-bps rate cut (3^rd consecutive meeting cut), Treasury buying by the Fed and a more dovish outlook than Wall Street had expected on rates, helped offset overnight tech weakness following Oracle’s (ORCL) disappointing quarterly revs, guidance and capex spending. While the Nasdaq still ended the day in negative territory, it finished significantly off the lows (bounced more than 200 points) ahead of semiconductor/Ai play Broadcom (AVGO) earnings tonight. The Philly semi index (SOX) still ended down on the day, and the S&P Tech sector (XLK) snapped its 13-day winning streak, but the S&P 500 clawed all the way back to 6,900 now, less than 20 points from its October all-time highs. Nearly every other S&P sector closed higher in a broad based rally that saw nearly 200 new 52-week highs in the NYSE today. NYSE breadth was very strong at more than 2:1 advancers, leading decliners as Materials, Financials and Healthcare were the biggest winners. Back to no fear as the CBOE Volatility index (VIX) fell about -5.% below the 15 level and lowest levels since September 15th when low was 14.92.

As mentioned, the weak spot for markets was S&P Tech sector (XLK), snapping its 13-day winning streak as the AI valuation and revenue concerns that sunk tech sector in early November returned as Oracle (ORCL) shares tumbled more than -15% after cloud sales missed estimates and prompted weakness names tied to Ai like semi chips, data centers and power plays like nuclear energy stocks. Early weakness in names like CRWV, NBIS, ETHN, VRT and chip names NVDA, AVGO (ahead of earnings) and power names OKLO, SMR, NNE and others. Oracle also warned capital expenditures for fiscal 2026 are now expected to be $15 billion higher than the company’s estimates in September. ORCL also forecast Q3 revenue growth of between 16%-18%, below the 19.4% est. of $16.87B. Tech investors are worried about an AI bubble, stoked by sky-high valuations, limited real-world productivity gains and complex circular investments, even as companies raise billions in debt to build infrastructure. Earnings tonight in the chip sector with AVGO, which is also heavily tied to the AI trade, is next tech catalyst.

Stifel provides a Macro & Portfolio Strategy for 2026 saying they see a 6,500-7,500 corridor as macro uncertainty persists. With Stifel Strategy having fallen into a bear trap after the tariff pivot in April 2025, they approach 2026 in terms of upside potential versus downside risk. The corridor we calculate is 6,500 to 7,500 for the S&P 500 in 2026. The bull case for stocks is based on low-teens S&P 500 EPS growth and only one multiple of normal S&P 500 P/E compression as non-tech cyclical earnings, which have been under pressure, come through. The bull case in 2026 is thus just over +9% price, or around 7,500 for the S&P 500. The bear case remains potential macro trends, with pressure on real personal consumption (68% of GDP, too large be offset by AI capex) and risk for unemployment/recession if slowing labor demand exceeds what has been fortuitously slowing labor supply growth. Any flare-up for economic risk could result in corrections in 2026

• The U.S. international trade in goods and services balance narrowed to -$52.8B in September from -$59.3B in the prior month (revised from -$59.6B), better than the -$62.5B expected, according to data from the U.S. Census Bureau released on Thursday. Exports drifted up to $289.3B in September from $280.8B in August, while imports rose to $342.1B from $340.4B over the same period. The September decrease in the goods and services shortfall reflects a $7.1B retreat in the goods deficit to $79.0B, as well as a $26.2B pullback in the services surplus of $0.6B.
• Wholesale inventories increased 0.5% M/M to $911.5B in September, stronger than the 0.1% increase expected and August’s flat reading.

• Oil prices extended loss, moving to the lowest levels since October, as WTI crude fell -$0.86 or 1.47% to settle at $57.60 per barrel while Brent crude fell -$0.93 or 1.49% to settle at $61.28 per barrel following reports that President Trump’s plan for peace in Ukraine includes proposals to restore Russian energy flows to Europe, major U.S. investments in Russian rare earths and energy, and to tap into frozen Russian sovereign assets.
• Natural gas prices down sharply for a 3rd straight day (down around -20% during that stretch) after hitting 3-year highs on Friday above $5.00M btus. At about $4.23 per million British thermal units (down -7.9% today), the heating and power generation fuel is now about $1 cheaper than a week ago. The EIA reported a 177 Bcf withdrawal from underground storage for last week, which was slightly more than expected, and the first major draw of the season.
• In Bonds, the U.S. sold $22B 29-year 11-month bond at high yield 4.773%, vs. 4.774% when issued before auction as the bid-to-cover ratio 2.36, with Primary dealers take 11.16% of U.S. 29-year 11-month bond sale, direct 23.46% and indirect 65.38%. Treasury yields overall extended recent declines. Today, New York Fed announced to Purchase $8.167 Billion 1 To 4 Month Bills on December 12.

• In Furniture Retail: LOVE shares slid after posting a wider-than-expected Q3 loss of (-$0.72) vs the (-$0.69) expected and (-$0.32) y/y as revs of $150.2M missed ests $154M and lowered FY26 EPS $0.15-$0.49 from prior view of $0.52-$1.05 and sales seen at $685M-$705M range, below prior view $710M-$740M.
• In Consumer Products: CL was downgraded to Hold from Buy at Argus citing the company’s margins having declined due to rising raw material costs and tariff pressure. Argus adds that it would consider returning the stock to its Buy list if volume pressure abated and margins returned to growth.
• In Autos: Major automakers on Thursday urged Washington to prevent Chinese government-backed automakers and Battery manufacturers from gaining entry in the United States to open manufacturing plants, warning the industry’s future is at stake. The Alliance for Automotive Innovation, which represents General Motors, Ford, Toyota Motor, Volkswagen, Hyundai and other major automakers, said Congress and the Trump administration needed to act. RIVN said develops Ai chip to replace Nvidia in future vehicles; to later add lidar sensors to future R2 vehicles. Reuters reported late day that TSLA U.S. sales drop to nearly 3-year low in November despite launch of Cheaper Model Y & 3.

• In Utilities: DTE was upgraded to Buy at Jefferies with $150 tgt on upside data center opportunities. +1.5GW expected in early 2026 (added to JEFF’s estimates) gives them confidence on 8%+ CAGR through 2030. Oracle approval (which is coming) can pave the way for 3GWs DCs in late Stage negotiations and a 6GW pipeline.
• In Energy/E&P: CVE announces 2026 capital budget and corporate guidance as expects capital investment to be between $5.0B and $5.3B in 2026, sees additional $1.2B to $1.4B of investment will be directed towards growth projects, sees 2026 Upstream production of between 945,000 barrels of oil equivalent per day and plans to invest between $450M and $500M in its conventional assets in 2026
• Oil Equipment & Services: WHD was upgraded to Buy from Neutral at Citigroup (tgt to $55 from $45) as part of its 2026 outlook for the oil and gas equipment and services group as believes the industry is in the bottom of a two-year downcycle. The lack of negative estimate revisions could drive better share performances in 2026.

• In Banks/Investment Managers: GS new all-time highs, rising an 8^th straight day topping $900 per share as financials rally behind rate cut by Fed. PNFP was double upgraded from Market Perform to Strong Buy at Raymond James and establishing and $120 price target heading into the New Year. In Annual Outlook and view that Regional/SMid banks are apt to have their “day in the sun” as the operating backdrop has become increasingly favorable for the Banking sector at large, it sees the risk-reward as increasingly attractive for PNFP. DHIL entered into a definitive agreement to be acquired by First Eagle Investments, an independent, privately owned, fundamentally driven investment management firm for $175 per share in an all-cash transaction valuing the Company at approximately $473 million.
• In Crypto/Blockchain: GEMI shares jumped after saying it received a Designated Contract Market (DCM) license from the Commodity Futures Trading Commission (CFTC). This regulatory approval allows Gemini to offer prediction markets to U.S. customers, marking the culmination of a five-year licensing process.
• In Consumer Lending: ENVA announced it has signed a definitive agreement to acquire Grasshopper Bancorp, Inc., and its wholly owned subsidiary Grasshopper Bank N.A., in a cash and stock transaction valued at approximately $369M. Grasshopper is a leading client-first, full-service digital bank founded in 2019 with more than $1.4B in total assets.
• In Brokers: TPG, APO, SF, SCHW named top picks in initiation of coverage of Brokers and Asset Managers at UBS (initiate/assume coverage on 20 U.S. Asset Managers & Brokers in all) while also Buy-rated on KKR, CG, HLNE, JEF.

• BHVN shares rose after saying its experimental therapy, BHV-1510, in combination with REGN Libtayo, showed efficacy and manageable safety across several tumors in an early-stage trial; said patients receiving the treatment every three weeks showed a 72.7% confirmed response.
• BMY said the FDA has granted priority review for its request seeking a label expansion for its antitumor therapy Opdivo to treat a blood cancer known as Hodgkin lymphoma as part of a first-line combination regimen.
• CRBP reports results from phase 1A study of oral CB1 inverse agonist CRB-913 for the treatment for obesity demonstrating favorable safety profile and emerging evidence of weight loss.
• GERN announced a corporate restructuring, including a one-third reduction in its workforce.
• IMVT prices $550M stock offering or 26.2M shares at $21.00.
• LLY said in TRIUMPH-4, participants with obesity and knee osteoarthritis taking retatrutide 12 mg lost an average of 28.7% of their body weight at 68 weeks. Retatrutide reduced WOMAC pain scores by up to an average of 4.5 points (75.8%) and significantly improved measures of physical function. Seven additional Phase 3 trials evaluating the investigational once-weekly treatment in obesity and type 2 diabetes are expected to complete in 2026.
• RYTM announced positive preliminary results from its exploratory Phase 2 trial of setmelanotide in patients with Prader-Willi syndrome, or PWS. The company also plans to advance setmelanotide into a Phase 3 registrational trial in PWS, pending successful completion of this Phase 2 trial.
• RZLT shares crumbled after saying its lead asset, ersodetug, failed to reach the main goals in a Phase 3 trial for patients with congenital hyperinsulinism. Based on topline results, the firm said its sunRIZE study for 63 patients with congenital HI didn’t meet the primary endpoint 9or secondary) related to the change in average weekly hypoglycemia events.

• In MedTech: Citigroup upgraded BLCO, PEN to Buy, downgraded HAE, ISRG to Neutral and opened positive catalyst watches on DXCM, BAX; negative catalyst watch on TNDM in Medtech 2026 outlook. The firm said it has been an interesting year for Medtech, with a Healthcare shift in October lifting the entire sector resulting in Healthcare’s best month versus the S&P 500, +900 bps. While 2026 lacks a “big” Medtech product driver, there are several milestones that should drive valuations. Top Picks include MDT and IRTC.
• In Life Science Tools and Diagnostics sector: Citigroup upgraded shares of TMO, FTRE to Buy while downgraded shares of QGEN, TXG to Neutral in 2026 outlook for sector saying investor sentiment in Tools has swung notably positive, exiting FY25 driven primarily by the MFN/pharma tariff agreements with the Trump Administration, which should prove to be a multi-year tailwind. Within Diagnostics, sentiment leans positive with volumes and profitability improvements as primary focal points. CROs are debated given the soft FY25 bookings flowing through, but an improving backdrop should provide a better set-up. Heading into FY26, RBC names CRL, CAI, and WST as top picks.
• In Optical sector: ALC was double downgraded to Underperform from Buy at Bank America and cut tgt to $75 from $100 saying Alcon’s outlook has dimmed following a year marked by market slowdown, competition, and guidance cuts that have weighed on sentiment and driven shares down 15% YTD.

• In Aerospace: PL shares jumped after the satellite-imaging firm raised its sales and margin outlook, boosted by new and expanded contracts. Recent wins included an expansion to a contract with NATO and a deal with National Geospatial-Intelligence Agency; reported Q3 revs rose 33% y/y to $81M vs. est. $72.02M, guides Q4 revenue $76M-$80M, vs. consensus $73.55M and raises FY26 revenue view to $297M-$301M from prior view $281M-$289M.
• Metals & Mining: shares of silver and gold miners/producers AG, CDE, HL, NEM, PAAS, WPM were higher today tracking more strength in precious metal prices with another all-time high for silver. Spot Silver climbs nearly 3% to hit fresh record high at $63.59/oz.
• Fertilizers/Chemicals: seeing strength in shares of CF, MOS, NTR and other chemicals like FMC after Ukraine said its drones hit two fertilizer plants in western Russia. The latter is a major global fertilizer exporter. A drone attack caused a large fire at a chemical plant in the Russian city of Veliky Novgorod overnight on December 11, according to regional authorities and several monitoring Telegram channels, said The Kyiv Independent.

• In Telecom: BCE was upgraded from Market Perform to Outperform at BMO Capital based on a relatively more attractive risk/reward profile saying the Canadian Wireless and wireline service revenue growth estimates are unchanged and imply 2% Y/y growth. The firm also downgraded Telus (TU) from Outperform to Market Perform and lowering its target price from $23 to $19 as believes the core telecom business is growing in line with peers and the outlook for TELUS Digital (now wholly owned) is unclear.
• In Media: DIS said it is investing $1B in OpenAI and signing a 3 year licensing deal that lets Sora generate short videos with 200+ Disney characters across Marvel, Pixar, Star Wars and more. Starting in early 2026, fans will be able to create character clips that can even show up on Disney+, while Disney also becomes a major OpenAI API customer for new products and internal ChatGPT tools. Under deal, will receive warrants to purchase additional equity in OpenAI.

• In AI news: OpenAI launched its GPT-5.2 artificial intelligence model, touting improvements in general intelligence, coding and long-context understanding, the company said in a statement. The new model is expected to bring even more economic value for users, as it is better at creating spreadsheets, building presentations and handling complex multi-step projects, OpenAI said. GPT-5.2 Instant, Thinking, and Pro will begin rolling out in ChatGPT on Thursday.
• In Gaming Software: Unity Software (U) was upgraded at both BTIG to Buy ($60 PT) and Piper to Overweight ($59 PT) saying their Vector Ad business has grown 15% quarter-over-quarter in the past two quarters.
• In EDA Sector: SNPS issued the first FY26 outlook that is slightly below the Street in revenue but decently above consensus in earnings following a quarterly beat on the top and bottom line.
• In Optical & Comm Equipment sector: CIEN shares rise on results, keeping the strong upward momentum alive in the sector (LITE, COHR, FN, etc.) Q4 adj EPS of $0.91 topped ests of $0.76 and revs rose 20.5% y/y to $1.35B above $1.288B estimate; said three customers accounted for 43.6% of total revenue in the quarter, while guidance for Q1 revs $1.35B-$1.43B (vs. est. $1.25B) and FY26 revs $5.7B-$6.1B (vs. est. $5.53B); COHR shares slipped early following disclosure that holder Bain Capital sold 5M shares in a block trade through Goldman Sachs.
• In Networking & Equipment: AAOI announced it received its first volume order for its 800G transceivers from a major hyperscale customer (which Needham said it assumed to be AMZN); Evercore ISI removed its "Tactical Outperform" call on ANET following the company’s September-end quarter report last month and negative stock reaction; Evercore also removed its "Tactical Outperform" call on HPE following the company’s October-end quarterly earnings release.
• In Quantum Compute: Mizuho initiated coverage on IONQ with an Outperform rating and $90 price target as sees the company as a leader in quantum computing with trapped ions’ low error rates and higher coherence times potentially driving a faster commercial ramp versus superconducting if qubit scaling can be executed. Mizuho also initiated RGTI with an Outperform rating and $50 price target as sees the company scaling with $450M in cash, equivalents, and investments on hand. Lastly, they initiated QBTS with an Outperform rating and $46 price target as see the company driving a dual track to annealing and gate model with potential for acquisitions. D-Wave is a dominant quantum annealing player in the near-term emerging optimization market, the analyst tells investors in a research note.