Closing Recap

Wednesday, December 31, 2025

U.S. stocks finished lower on Wednesday but closed higher on the year, with the Dow, S&P 500 and Nasdaq posting their third straight year of double digit % gains. Stocks closed lower for a 4^th straight session on muted volume and news as so far, the Santa Claus rally is not looking good…though there are two days remaining still. Santa Rally by definition is the last 5 trading days of December and the first 2 trading days of January. Well so far, we saw green on December 24^th, but red the next 4 days since. 2026 will be remembered as the year of AI, while other top stories included continued tariffs, and global tensions. Nine of the eleven S&P sectors finished 2025 higher, led by Technology (XLK) +24%, Communications (XLC) +21.5%, Industrials (XLI) +17.7%, and Financials (XLF), Healthcare (XLV) and Utilities (XLU) all rose around 13%. Consumer Staples (XLV) and REITs (XLRE) each ended lower by around -1% this year. As for Internation Performance in ’25: among the best was South Korea (EWY) +94%, Peru (EPU) +84%, Spain (EWP) +74%, Greece (GREK) +71% and Austria (EWO) +69% as Emerging Mkts (EEM) +34%.

Unofficially, for the month the S&P 500 fell -0.05%, the Nasdaq declined -0.53%, and the Dow climbed 0.73%; for the quarter the S&P 500 gained 2.35%, the Nasdaq climbed 2.57%, and the Dow climbed 3.59%. For the year the S&P 500 gained 16.39%, the Nasdaq climbed 20.36%, and the Dow climbed 12.97%. Dow industrials climb for eighth straight month, longest streak of gains since 10-month run ended January 2018. Dow, S&P 500, Nasdaq composite record third straight year of gains.

Interesting stats: 1) @charliebilello notes, “the average M&A deal size of $227 million this year was a new record high, surpassing the prior record from 1999” and also notes, “there were 68 global M&A deals valued at over $10 billion this year, surpassing the prior record set in 2015.” 2) @bespokeinvest noted, “The S&P 500 has declined on the last trading day of the year for each of the last four years. Since 2000, the S&P 500’s median change on the last trading day of the year has been a decline of 0.28%, with gains less than a third of the time.” 3) @bespokeinvest notes, “Horrible breadth on the S&P 500 today. Weakest since May 21st, and on pace for the most negative final trading day of the year since 2009.”

• US mortgage rates fell for a third straight week, ending 2025 at a yearly low. The average 30-year fixed rate dropped to 6.15% from 6.18%, according to Freddie Mac.

• Oil prices were down -$0.53 or 0.91% to settle at $57.42 per barrel and posted its steepest annual loss since the start of the pandemic in 2020, in a year that has been dominated by geopolitical risks and steadily rising supplies across the globe. A punishing surplus is expected to weigh on prices in 2026. Brent slipped below $61 a barrel, with prices down 18% this year. Traders’ near-term focus is on an OPEC+ meeting at the weekend, a bearish weekly US industry report, and President Donald Trump’s policies toward major producers Russia, Iran and Venezuela. Global oil markets have been oversupplied this year. Both the International Energy Agency and the US government see production exceeding consumption by just over 2 million barrels a day in 2025 and that surplus worsening in the coming year. US Nat gas prices fell -7% today but hung on to a 1.46% advance for 2025.
• Weekly inventory data showed U.S. crude stocks fell while gasoline and distillate inventories rose last week, the Energy Information Administration said. Crude inventories fell by 1.9 million barrels to 422.9 million barrels in the week ended December 26, vs expectations in a Reuters poll for a 867,000-barrel draw. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 543,000 barrels in the week. U.S. gasoline stocks rose by 5.8 million barrels vs analysts’ expectations in a Reuters poll for a 1.9-million-barrel build.​

• The benchmark 10-year yield rose 2.4bps to 4.152% but was down -42.5bps this year; was up 13.4bps this quarter and posted monthly gain this month, snapping a 4-month streak of falling yields. The 2-year yield edged higher 1.5bps to settle at 3.468%, but was down -78.1bps this year, down 4 straight quarters, 2 straight months and largest one year decline since 2020. The 30-yr yield was +1.8bps today to settle at 4.829%and was up 4.4bps on the year.

• In Consumer news today: NKE shares rose after a filing overnight showed CEO Elliott Hill bought 16,388 shares at $61.10 on 12/29 in the open market valued at $1M worth of shares. The purchase follows Apple (AAPL) CDEO Tim Cook revealing a $3M purchase of Nike shares late last week.
• S&P 500 Restaurants index is down slightly on the year as weaker spending hurt chains such as CMG and CAVA, with shares falling ~40% and ~50% YTD, respectively. Dow component MCD advanced around 6% this year while DPZ ended up slightly. Value meals at Burger King and continued strength at Tim Hortons helped QSR shares rise 6% this year. YUM among best performers, rising 13.5%, marking its third year of rise, on Taco Bell strength. SHAK a standout to the downside falling around -37% this year. SBUX shares fell around -6% this year.
• Some big YTD winners and even bigger losers in the Retail/accessory sector as athleisure brands felt the weight of tariffs on their margins this year and tried to pivot to categories such as sports and running. Luxury was a winner with TPR +98%, RL +55%, GOOS +24% and CPRI +165% year-to-date. Shares of AEO +60%, LEVI 21% GAP up around 10% strong in apparel, KSS +44%, Macy’s (M) +30% in Department stores but that’s where the positive ends. Shares of LULU -44% YTD, NKE -18%, DECK -48%, ONON -13%, UA -37% and VFC -14% among names seeing margins impacted amid tariffs. 
• In Gaming, Benchmark named SGHC as a 2026 EDM Top Idea (Buy rated and $17 tgt), reflecting their conviction that the company is entering a multi-year earnings compounding phase driven by exposure to large, underpenetrated end markets, a highly durable Casino-led revenue mix, and expanding operating leverage. The firm also named GENI as 2026 EDM Top Idea, supported by accelerating Media monetization, structurally improving data-driven Engagement, and expanding operating leverage as the business transitions into a durable cash flow compounder.

• Energy (XLE) ends 2025 with a 4% gain, but refiners outperformed. U.S. refiners were among the top performers on the S&P 500 energy index as VLO gained +32% on year, MPC +17% and PSX +13% boosted after U.S. refining margins rebounded from multiyear lows in 2024, as supply shortages tied to geopolitical tensions in Ukraine supported stronger pricing. Smaller refiners like DINO gained 30% and DK +61%.

• The fintech and payments universe had solid performance in 2025, with stocks exhibiting a wide range of outcomes. Performance was strongest in fintech platforms (+42%), the third consecutive year of solid gains. The big winners again were DAVE, PGY and SEZL per B Riley, which were up 134%, 123%, and 53% respectively, over the past 52 weeks. Integrated payments woefully underperformed despite median EPS growth up mid-teens. Not one stock posted positive returns YTD through 12/30 according to B Riley.
• Heading into 2026, SpaceX, Anthropic, Kraken, Cerebras are among the names likely to make an IPO splash in the New Year. Elon Musk’s space technology company SpaceX, founded in 2002, is eyeing a historic IPO potentially valued at $1.5 trillion, raising about $30 billion—the largest by capital raised. Anthropic, founded in 2021 and valued at $350 billion, develop models like Claude for enterprise coding tools.

• BCAB and GATC announce a $40 Million Special Purpose Vehicle (SPV) transaction to advance Ozuriftamab Vedotin (Oz-V) into a registrational trial for 2l+ oropharyngeal squamous cell carcinoma (OPSCC).
• CORT shares tumbled following yesterday’s -12% loss after saying they received a Complete Response Letter (CRL) for Relacorilant as a treatment for patients with hypercortisolism.
• VNDA shares rose after saying the FDA has approved its drug Nereus to prevent motion-induced vomiting and the company expects to launch the drug in the coming months.
• Obesity drugs were mixed this year as shares of LLY have risen nearly 40%, posting its ninth successive year of gains while Ozempic and Wegovy maker NVO shares have fallen -40% this year. Investors are focused on the potential approval and launch of LLY’s oral GLP-1 drug orforglipron for 2026
• Rough year for vaccine stocks, under pressure after new leadership at HHS, as PFE down around -6% on year, MRNA -26%, NVAX -16% and BNTX -16% as demand for COVID-19 vaccines and treatments waned.
• Managed Care and Hospitals mixed this year as CVS rises 77% this year, set to snap three consecutive years of losses, while UNH fell -34% on year following a federal probe and Americans’ anger at insurance industry practices. ELV, CNC, MOH shares also declined as they battle stubbornly high costs for over two years due to the increased use of healthcare services across government-backed plans. The S&P 500 Managed Health Care index has fallen 28.7% YTD, set for the worst year since 2008. Hospital operators are poised to close the year on a high, buoyed by sustained demand for healthcare services with HCA +57%, THC +59% and UHS +24% on year.
• MedTech stocks were mixed in 2025: with shares of BSX, MDT, JNJ (+43% YTD), ABT, EW, GEHC were all higher while shares of BDX, ZBH, BAX, SYK finished with losses in 2025. BAX fell about -34% for its fourth straight year in the red due to continued pain from profit warnings and hurricane disruptions at its key facility. BSX and EW posted standout gains on repeated profit upgrades and strong revenue from top heart devices

• Precious metals a huge standout in 2025 behind massive gains in gold/silver/platinum/palladium and boosting shares of metal miners (AEM, AG, B, CDE, FSM, HL, NEM, PAAS, WPM). Silver and platinum prices have more than doubled and gold’s run of record highs leading to its strongest performance in more than four decades. Gold prices have rocketed about 65% this year, their steepest annual rise since 1979, with the rally reflecting the impact of U.S. interest rate cuts and expectations of further monetary easing, geopolitical strains, heavy central bank buying, and robust ETF inflows.
• Silver has gained more than 145% year-to-date, its strongest year ever and far outpacing gold, hitting highs of $83.62 an ounce on Monday – but has since fallen back around $71 on profit-taking after the CME raised margins again on precious metal futures has knocked prices off their peaks. The rally has been driven by supply shortages, low inventories, rising industrial and investor appetite, and its recent designation as a critical mineral in the United States. Spot platinum is down from a lifetime high of $2,478.50 on Monday (+110% YTD coming into the day) and Palladium (XPD) +60% YTD.
• Copper prices posted their biggest annual gain since 2009, fueled by near-term supply tightness and bets that demand for the metal key in electrification will outpace production. Copper  notched a series of all-time highs in an end-of-year surge, rallying over 40% on the London Metal Exchange this year. That makes it, along with tin, the best performer of the six industrial metals on the bourse.
• New York cocoa futures eased slightly on Wednesday and posted a steep annual decline of 48%, with a sharp rise in prices in 2024 leading to both a decline in demand and a boost in supplies. * Cocoa was one of the strongest performing commodities in 2024 with New York prices rising 178%.
• Chemical companies posted sharp losses in 2025, impacted by weak demand, higher input costs and tightening European regulations. Some of the biggest losers in 2025 included LYB -41%, EMN -30%, DOW -41%, CC -30%, with even bigger declines in ag chems like FMC which is down -71% YTD. Citigroup noted recently they see a risk of degradation in integrated polyethylene margins with more risk of oil-to-gas spread compression and pressure on export markets.
• Rare earths miners were a huge story in 2025, with strong gains in MP +223% YTD, TMQ +270% YTD, CRML, METC also ending the year higher boosted by a global trade war, supply constraints and as countries, including the United States, rushed to secure domestic supplies of critical minerals to reduce dependence on China. MP shares outperformed after the government took a 15% stake.

• Semiconductor makers were big winners in 2025, as the Philadelphia Semiconductor Index (SOX) advanced over 43% higher; its third consecutive year of gains with NVDA up around 40% YTD, AVGO +50%, AMD +80%, INTC +85% (after a 60% drop in 2024) but the biggest winners were in memory as MU surges 250% YTD as AI demand-linked global memory shortage boosts investor sentiment; SNDK also up big rising +558% YTD, WDC +290% and STX +224%
• In Research today, Wedbush downgraded GFS to Neutral from Outperform saying while believes that GlobalFoundries has a path to a model with stronger revenues, improved utilization, and better margins on improved end market fundamentals and a shift towards local supply chains, it also believes recent developments have elongated the timeframe around when those catalysts might play out; the firm also cut TSEM to Neutral on valuation.
• In News for NVDA, Reuters reported early this morning that Nvidia has reached out to semiconductor manufacturer TSM to ramp up production of its H200 chips in response to strong demand from China. Nvidia has reportedly received more than 2 million H200 chip orders from China, to be delivered in 2026, but has only 700,000 on hand. According to the South China Morning Post, ByteDance could be looking to spend up to 100 billion yuan, or $14 billon, in Nvidia’s H200 chips in 2026, if the chips are allowed to be imported.