Weekend Update, December 1st, 2025

Holiday Rally

Index, Sector, and Asset Performance

With the help of more dovish Fed talk as well as a hint of whom President Trump might nominate as the next Fed Chair, the S&P 500 rallied +3.7% during the holiday shortened week ending November with a slight gain. The S&P 500 closed the week at 6,849, marking a +0.1% increase from where it started in November. The rally last week kick saved the S&P 500 to its 7th straight monthly gain. That said, peak to trough, the S&P 500 dropped -6% from its all-time high achieved on October 29 to its intra-November low. This November’s volatility caused retail investor sentiment, as measured by the American Association of Individual Investors (AAII), to remain net bearish at negative -10.7%, a historically contrarian reading.

The last 2 Fridays have shown a large increase in market breadth which should dispel the “it’s only 7 stocks” leading the markets talk. 90.1% of S&P 500 stocks finished the week above their 10-day moving average for the first 10-day breadth thrust since May.

All 11 of the S&P 500 sectors rose last week. Communication services, led by both Facebook and Google, had the strongest gain, up +5.9%, followed by a +5.3% rise in discretionary and a +4.3% gain in technology. The smallest gain was in the energy sector. Meta Platforms/Facebook (META) had the biggest increase in communication services, jumping +9%. Google (GOOGL, GOOG) was also among the top gainers, up slightly more than +6.8%. Meta is rumored to be using Google’s tensor processing units (TPU) in its data centers in 2027, and it may also rent those chips from Google’s cloud unit in 2026, according to a report by The Information. Tesla (TSLA) was the best stock in consumer discretionary, rallying +10%. The electric vehicle manufacturer opened its first all-in-one center in India, offering sales, service, delivery, and charging facilities under one roof. Elon Musk also said the company plans to expand its fleet of robotaxis in Austin, Texas in December.

For the month of November, tech stocks sank more than -4.7%, led by big tech stock weakness.

Per Goldman Sachs 1-Week asset returns:

US 10-year Treasury yields sit near 4% still. The 2yr US Treasury note yields 3.48%, about 25 bps below the lower end of the current fed funds band (3.75%‒4.00%).

Economic Indicators and Earnings Commentary

The November 26th estimate from the Atlanta Fed’s GDPNow model suggests a +3.9% real GDP growth rate for 3q25.

US September jobs numbers, which were released due to the government shutdown, showed higher-than-expected nonfarm jobs. However, the unemployment rate rose to 4.4% in September from 4.3% in August. October jobs numbers have yet to be released.

Investors are increasingly positive that the FOMC will cut its benchmark interest rate at its December meeting. A combination of dovish public Fed speeches and the private payrolls released last week by ADP showing a decrease of -13,500 jobs in the four weeks ending on Nov. 8 have raised odds of another cut this year.

ISM manufacturing and services indexes, core PCE inflation and the University of Michigan report will be released this week.

Earnings season almost over, and S&P 500 companies are tracking +15% earnings-per-share growth rate, well above expectations. This is the second quarter in a row where reported earnings were significantly stronger than the Wall Street expectations.

Last week’s earnings included:

Ross Stores (ROST) hit a new all-time high with its best earnings since 2022. Management team raised its forward guidance ahead of what they believe will be a strong holiday season.

Keysight Technologies (KEYS), rallied +10% on earnings and better 2026 guidance. Free cash flow hit a record high of $1.3B, and the company is using it for acquisitions and share buybacks.

Analog Devices (ADI) rallied over +5% after the semi company beat expectations across the board. Revenues increased +26% YTY, led by the industrial segment, which grew +46%.

Earnings calendar includes Credo (CRDO), Signet Jewelers (SIG), CrowdStrike Holdings (CRWD), SnowFlake (SNOW), Marvel (MRVL), MongoDB (MDB), Kroger (KR), Docusign (DOCU), Ulta Beauty (ULTA), and Salesforce (CRM).

Commodities and Currencies

Oil and its products rallied back to $60/bbl.

The US dollar has been rallying since mid-April and sits close to 100.

Precious metals like gold and silver continued their strong YTD performance with gold back over $4,250/oz, while crypto assets and Bitcoin dropped under $90,000 again this weekend.

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Past performance is no guarantee of future results. Indexes are unmanaged and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. The preceding discussion is for informational purposes only. Investing involves risk and no reference to any security listed above should be considered a buy or sell recommendation. Advisory services are provided through Oak Harvest Investment Services, LLC, a registered investment adviser.