The S&P 500 Index ($SPX) (SPY) on Monday closed down -0.35%, the Dow Jones Industrials Index ($DOWI) (DIA) closed down -0.51%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -0.46%. March E-mini S&P futures (ESH26) fell -0.34%, and March E-mini Nasdaq futures (NQH26) fell -0.47%.
Stock indexes settled lower on Monday, led by losses in megacap technology stocks. Also, Monday's plunge in metals prices weighed on mining stocks. Lower bond yields were supportive of stocks, with the 10-year T-note yield falling to a 1-week low of 4.10% on Monday.
Monday’s US economic news was mixed for stocks. Nov pending home sales rose 3.3% m/m, beating expectations of 0.9% m/m. Conversely, the Dec Dallas Fed manufacturing outlook of general business activity unexpectedly fell -0.5 to -10.9 versus expectations of an increase to -6.0.
Silver and platinum fell sharply from fresh record highs on Monday amid profit-taking following their parabolic rallies. The recent surge in both metals has taken prices to overbought levels, sparking technical selling. Also, the CME on Monday raised margin levels for precious metals trading, sparking some long liquidation pressures in metals.
Crude oil prices rose by more than +2% on Monday, lifting energy producers and limiting losses in the broader market, as advanced peace talks over the weekend to end the Ukraine-Russian war failed to yield a breakthrough. Geopolitical tensions from Venezuela to Nigeria are also supporting crude prices. In addition, crude prices rose after China's Ministry of Finance on Sunday pledged to broaden its fiscal spending base next year, signaling government support to drive economic growth.
Seasonal factors are bullish for stocks. According to data from Citadel Securities, since 1928, the S&P 500 has risen 75% of the time in the last two weeks of December, climbing 1.3% on average.
Market attention this holiday-shortened week will focus on US economic news. On Tuesday, the Dec MNI Chicago PMI is expected to rise by +3.5 points to 39.8. Also, the minutes of the December 9-10 FOMC meeting will be released. On Wednesday, initial weekly unemployment claims are expected to increase by 1,000 to 215,000. On Friday, the Dec S&P manufacturing PMI is expected to remain unrevised at 51.8.
The markets are discounting the odds at 16% for a -25 bp rate cut at the FOMC's next meeting on January 27-28.
Overseas stock markets settled mixed on Monday. The Euro Stoxx 50 closed up +0.10%. China's Shanghai Composite climbed to a 6-week high and closed up +0.04% for the ninth consecutive daily gain. Japan's Nikkei Stock 225 closed down -0.44%.
Interest Rates
March 10-year T-notes (ZNH6) on Monday closed up by +4.5 ticks. The 10-year T-note yield fell -1.8 bp to 4.110%. Mar T-notes rose to a 1-week high on Monday, and the 10-year T-note yield fell to a 1-week low of 4.102%. Monday's stock market weakness boosted safe-haven demand for T-notes. Also, geopolitical risks in Venezuela and Nigeria have added to the safe-haven appeal of T-notes. Monday’s US economic news was mixed for T-note prices, as the Dec Dallas Fed manufacturing outlook for general business activity unexpectedly declined, while Nov pending home sales rose more than expected.
European government bond yields moved lower on Monday. The 10-year German bund yield fell to a 3-week low of 2.824% and finished down -3.3 bp at 2.829%. The 10-year UK gilt yield dropped to a 1-week low of 4.459% and finished down -2.0 bp to 4.486%.
Swaps are discounting a 0% chance of a +25 bp rate hike by the ECB at its next policy meeting on February 5.
US Stock Movers
The Magnificent Seven stocks settled mostly lower on Monday, pressuring the broader market. Tesla (TSLA) closed down more than -3% to lead losers in the Nasdaq 100, and Nvidia (NVDA) closed down more than -1%. Also, Meta Platforms (META) closed down -0.69%, Amazon.com (AMZN) closed down -0.19%, and Microsoft (MSFT) closed down -0.13%. Bucking the trend, Alphabet (GOOGL) closed up +0.02% and Apple (AAPL) closed up +0.13%.
Mining companies retreated on Monday, after gold prices sank more than -4% and silver prices plunged more than -8% after initially climbing to a new record high. Newmont (NEM) closed down more than -5% to lead losers in the S&P 500. Also, Hecla Mining (HL) and Coeur Mining (CDE) closed down more than -4%, and Freeport-McMoRan (FCX) closed down more than -2%.
Energy companies moved higher on Monday as WTI crude rose more than +2%. Devon Energy (DVN), Diamondback Energy (FANG), ConocoPhillips (COP), Exxon Mobil (XOM), Valero Energy (VLO), and Occidental Petroleum (OXY) closed up more than +1%.
Praxis Precision Medicine (PRAX) closed up more than +11% after getting a breakthrough therapy designation from the FDA for its ulixacaltamide for the treatment of patients with essential tremor.
DigitalBridge Group (DBRG) closed up by more than +9% after SoftBank Group acquired the company for about $4 billion, or $16 a share.
Verisk Analytics (VRSK) closed up +2% after announcing that it terminated its agreement to purchase AccuLynx.
Coupang (CPNG) closed up more than +1% after offering compensation worth more than $1 billion to all customers affected by a data breach.
Earnings Reports(12/30/2025)
Bright Minds Biosciences Inc (DRUG), Daily Journal Corp (DJCO), Dakota Gold Corp (DC), Lionsgate Studios Corp (LION), Phoenix Education Partners Inc (PXED), Triller Group Inc (ILLR).
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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