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December 26, 2025 – 16:03

(Bloomberg) — The post-Christmas session on Wall Street saw stocks fluctuating near their all-time highs as recent signs of economic resilience reinforced positive expectations for corporate profits.

While the S&P 500 was little changed, it headed toward its best week in a month. Trading volume was 50% below the average of the past month. Nvidia Corp. rose on a licensing deal with artificial-intelligence startup Groq. Freeport-McMoRan Inc. joined gains in materials producers as gold hit a record.

Action in currencies and bonds was subdued, with Treasuries poised for a small monthly loss, yet still on pace for their best annual performance since 2020 following three Federal Reserve rate cuts.

“Today should be a quiet trading day barring any geopolitical surprises as there are no economic reports, no meaningful earnings nor any Fedspeak,” said Tom Essaye at The Sevens Report.

Volatility on the day after Christmas has been below average, but it still tends to be the most-volatile day of the year between the holiday and year-end, according to Bespoke Investment Group. Meantime, the S&P 500 has only fell on Dec. 26 six times in the 39 years that US markets have been open on the day after Christmas since 1953.

The technical backdrop remains supportive, raising the possibility that the S&P 500 could avoid another year of negative Santa Claus Rally returns, according to Adam Turnquist at LPL Financial. That’s the period which typically encompasses the last five trading days of the year and the first two of the new one.

One intriguing aspect is the pattern’s historical connection to future performance. A positive outcome has seen the S&P 500 deliver an average January gain of 1.4% and a 10.4% surge for the full year that follows, said Turnquist.

“While overall market breadth remains somewhat narrow for an index near record highs, the trend is moving in the right direction, supported by a rotation toward cyclical sectors,” he said. “A close above the S&P 500’s December high could pave the way for the next leg higher above the 7,000-point milestone.”

The S&P 500 hovered near 6,930. The yield on 10-year Treasuries slid one basis point to 4.12%. The dollar was little changed. Bitcoin whipsawed.

“Markets remain constructive, but selective,” said Craig Johnson at Piper Sandler. “The combination of improving breadth and easing inflation supports the call for a Santa Claus rally. Leadership continues to narrow toward AI, cyclicals, and select defensives.”

Seasonal tailwinds may help, but confirmation via breadth and participation is still required, he noted.

Among the risks to the market, Turnquist at LPL cites increased scrutiny over AI — given lofty expectations for earnings and spending. Inflation concerns may also resurface, he noted, reducing prospects for rate cuts, while continued labor market weakness could add to economic uncertainty.

“The consensus among Wall Street investment strategists is that the magic will last,” said Ed Yardeni, founder of Yardeni Research. “However, the first half of 2026 could see a correction if bond yields rise significantly, given mounting concerns that monetary and fiscal policies might be overly stimulative.”

What supports stock prices over the long term are expanding earnings, which essentially require a growing economy, according to Jose Torres at Interactive Brokers.

“If the reacceleration continues as we flip the calendar, the market doesn’t need monetary policy accommodation to continue appreciating,” he said. “There will be sufficient fuel from fiscal stimulus, lighter taxation, capital expenditure depreciation incentives, milder regulations, and subdued energy costs to sustain the run, amid amplified top and bottom lines.”

Corporate Highlights:

Coupang Inc. rose after Yonhap News reported the e-commerce company has identified the former employee who allegedly accessed personal data of 33 million customers and retrieved all hard disk drives and devices that the ex-worker used. Biohaven Ltd. sank after a mid-stage study of the company’s experimental drug BHV-7000 for the treatment of major depressive disorder missed the primary endpoint. China Vanke Co., which just days ago got a reprieve on a local bond, has gained further breathing room after investors agreed to extend the grace period of another note, helping the embattled developer avert an imminent default once again. A Dutch nonprofit is seeking €1.4 billion ($1.6 billion) in compensation from Tata Steel’s Netherlands units, alleging that harmful emissions from its operations have caused environmental harm and health damage to nearby residents. Indian technology services provider Coforge Ltd. agreed to buy Encora at an enterprise value of $2.35 billion in an all-stock deal, adding artificial intelligence, data and product engineering expertise. Some of the main moves in markets:

Stocks

The S&P 500 was little changed as of 10 a.m. New York time The Nasdaq 100 was little changed The Dow Jones Industrial Average was little changed The MSCI World Index was little changed Bloomberg Magnificent 7 Total Return Index was little changed The Russell 2000 Index fell 0.5% Nvidia rose 1.5% Freeport rose 1.7% Currencies

The Bloomberg Dollar Spot Index was little changed The euro was unchanged at $1.1784 The British pound was little changed at $1.3516 The Japanese yen fell 0.4% to 156.45 per dollar Cryptocurrencies

Bitcoin fell 0.6% to $87,349.01 Ether fell 1% to $2,914.59 Bonds

The yield on 10-year Treasuries declined one basis point to 4.12% Germany’s 10-year yield was unchanged at 2.86% Britain’s 10-year yield was little changed at 4.51% The yield on 2-year Treasuries declined two basis points to 3.48% The yield on 30-year Treasuries was little changed at 4.79% Commodities

West Texas Intermediate crude fell 0.8% to $57.91 a barrel Spot gold rose 1% to $4,522.76 an ounce ©2025 Bloomberg L.P.