Core Viewpoint - The U.S. stock market experienced significant gains leading up to the Thanksgiving holiday, driven by investor optimism regarding a potential Federal Reserve interest rate cut in December [2]. Market Performance - The Dow Jones Industrial Average rose by 314.67 points (0.67%) to close at 47,427.12 on November 26, 2025, reflecting strong investor sentiment [2]. - Dow Futures remained nearly unchanged during early trading on the holiday [2]. Company-Specific Movements - Notable gainers among Dow components included Boeing (BA) with a rise of 2.46%, Walmart (WMT) increasing by 2.07%, and Microsoft (MSFT) up by 2.04% [3]. - Conversely, Salesforce (CRM) saw a decline of 2.51%, Merck (MRK) decreased by 0.73%, and 3M (MMM) dropped by 0.43% [3].

Market Overview - U.S. equities continued to rise, with major indexes extending a multi-day winning streak, driven by optimism for a Federal Reserve interest rate cut in December and dovish economic data releases [1][8] - The Nasdaq Composite led the gains, climbing 1%, while the S&P 500 and Dow Jones Industrial Average rose 0.9% each, marking their fourth consecutive day of gains [2][3] Economic Indicators - Expectations for a 25-basis-point rate cut by the Federal Reserve in December are high, with probabilities around 80-85%, supported by weaker-than-expected economic data [3][6] - Recent economic data included a decline in September retail sales, a softer Producer Price Index (PPI), decreased consumer confidence, and a drop in private payrolls [3] Sector Performance - Technology stocks were the primary drivers of the market rally, with the "Magnificent Seven" technology stocks significantly contributing to the overall market performance [4] - The Health Care Select Sector SPDR and Consumer Discretionary Select SPDR also performed well, gaining 2.3% and 2.1% respectively, while the housing sector benefited from a decline in Treasury yields [4] Corporate News and Stock Highlights - Apple shares rose about 1% as it is expected to surpass Samsung in global smartphone shipments for the first time in 14 years [7] - Dell Technologies surged 6-6.4% after announcing record orders for its AI servers, indicating strong demand in the AI infrastructure space [11] - Advanced Micro Devices (AMD) rose approximately 3.5%, while Broadcom gained about 3% [11] - Nvidia experienced a significant drop of 2.6-3.9% on Tuesday but rebounded slightly on Wednesday, facing increased competition in the AI chip market [11] - Urban Outfitters soared between 10% and 12.1% after reporting stronger-than-expected quarterly results, while Workday sank 9% despite positive earnings [11] - Petco surged 19.8% after raising its fiscal year earnings outlook, and Robinhood Markets jumped 10.7% following plans to launch a futures and derivatives exchange [11]

Economic Data and Market Reactions - Weaker-than-expected U.S. economic data has increased expectations for a Federal Reserve interest rate cut next month, positively impacting global equities as the Thanksgiving holiday approaches [1] - U.S. retail sales rose by 0.2% in September, falling short of the 0.4% forecast by economists, following a 0.6% gain in August [6] - The Conference Board's consumer confidence index dropped to 88.7, marking the lowest level since April, indicating weakening consumer sentiment [6] UK Budget and Political Context - British finance minister Rachel Reeves is expected to announce significant tax increases in her budget, which is critical for her credibility with bond investors and lawmakers [3] - The Labour government's unpopularity may present challenges for Reeves as she navigates the budget announcement [5] Market Trends and Sector Performance - U.S. tech companies' share of S&P 500 earnings has been declining, raising concerns about the disconnect between their stock prices and underlying profit trends, despite their market value remaining high [4]

Group 1 - The dollar is trading near a one-week low due to softer-than-expected U.S. economic data, which has increased expectations for a Federal Reserve interest rate cut in December [1][2] - Retail sales and core wholesale prices in September rose less than anticipated, while the Conference Board's consumer confidence index for November unexpectedly declined, indicating a contraction in private payrolls [2]

Group 1: HP Inc. Developments - HP Inc. is planning to cut between 4,000 and 6,000 jobs through fiscal year 2028 as part of a significant restructuring effort [2][7] - The company issued a weaker-than-expected profit outlook, projecting full-year earnings of $2.90 to $3.20 per share, which falls short of analyst estimates [2][7] - The challenging forecast is attributed to rising memory-chip costs, and HP aims to leverage AI tools to achieve $1 billion in annual savings [2][7] Group 2: Dell Technologies Performance - Dell Technologies has significantly increased its annual forecast for AI server shipments to $25 billion, driven by strong demand from data centers [3][7] - The company reported a strong third-quarter performance that positively impacted its share price, highlighting the contrasting fortunes between Dell and HP [3][7] Group 3: Market Trends - Financial markets are increasingly anticipating a Federal Reserve interest rate cut in December, with traders actively engaging in Fed futures [4][7] - This sentiment indicates a potential shift in monetary policy that could affect economic growth and asset valuations [4][7] Group 4: General Motors Executive Departure - General Motors announced the departure of Senior Vice President Baris Cetinok, which may indicate internal shifts or strategic realignments within the company [5][7]

Market Overview - European stocks are expected to open sluggishly as investors await key U.S. economic data, including retail sales, pending home sales, producer prices, and consumer confidence, which may influence inflation and consumer spending patterns [1] - U.S. stock futures have edged lower after a rebound in major averages, driven by strength in the artificial intelligence sector and renewed hopes for a Federal Reserve interest rate cut, with an over 80% chance of a quarter percentage point cut priced in for December [2] Company-Specific Developments - In extended trading, Alphabet shares rose while Nvidia and AMD shares declined after reports that Meta is considering using Alphabet's custom chips for its data centers [3] - The tech-heavy Nasdaq Composite surged 2.7%, influenced by comments from Federal Reserve officials indicating potential easing next month, while the S&P 500 and Dow also saw gains of 1.6% and 0.4% respectively [5] Economic Indicators - The dollar index remained steady, oil prices decreased due to oversupply concerns, and gold prices slightly increased after a nearly 2% rise in the previous session [4] - U.S. stocks started the Thanksgiving trading week positively, driven by optimism in AI, expectations of a Federal Reserve rate cut, and progress in discussions regarding the Russia-Ukraine conflict [4]

Economic Outlook - New York Fed President John Williams indicated potential for interest rate cuts due to a weakening labor market [1] - Boston Fed President Susan Collins suggested maintaining current interest rates as inflation remains elevated [1] - Dallas Fed President Lorie Logan expressed skepticism about further rate cuts unless inflation decreases more rapidly or the labor market cools significantly [1] Economic Data - U.S. S&P Global manufacturing PMI fell to 51.9 in November, slightly below expectations of 52.0 [1] - S&P Global services PMI unexpectedly rose to 55.0, exceeding expectations of 54.6 [1] - University of Michigan's consumer sentiment index for November was revised to 51.0, stronger than the expected 50.6 [1] Market Performance - Wall Street's major equity averages closed higher, with Ross Stores (ROST) gaining over 8% after positive Q3 results and raised earnings guidance [3] - GlobalFoundries (GFS) and ON Semiconductor (ON) saw gains of over 5% and 4% respectively, while Intuit (INTU) rose more than 4% following strong FQ1 results [3] - Veeva Systems (VEEV) experienced a decline of over 9% after reporting weaker-than-expected Q3 adjusted gross margin [3] Investor Sentiment - Lower bond yields are supporting stock index futures, with expectations for a Fed rate cut in December [4] - U.S. rate futures indicate a 75.5% chance of a 25 basis point rate cut at the December Fed meeting [5] Upcoming Economic Reports - Investors are closely monitoring delayed economic data including September Retail Sales, Producer Price Index, and Durable Goods Orders [6] - Other significant data releases include Consumer Confidence Index, Pending Home Sales, and Initial Jobless Claims [6] Earnings Reports - High-profile companies such as Dell Technologies, HP Inc., and Analog Devices are scheduled to release quarterly results this week [7] Federal Reserve Insights - The Fed's Beige Book survey will provide updates on economic conditions, likely highlighting weaknesses in employment and activity [8]

Core Insights - The stock market, particularly the S&P 500 and Nasdaq Composite, has faced challenges as concerns grow over the Federal Reserve's dual mandate of managing low unemployment and inflation [1][2] - The Fed's recent interest rate cuts were influenced by rising unemployment, but there is ongoing debate about potential further cuts in December [2][6] - Inflation has increased to 3% in September from 2.3% in April, primarily due to tariffs, while the job market shows signs of weakness with wages not keeping pace with inflation [3][9] Group 1 - The Federal Reserve's decision to cut interest rates in September and October was driven by concerns over rising unemployment [2] - Bill Gross, a veteran bond manager, has expressed skepticism about the Fed's ability to effectively manage its conflicting goals of unemployment and inflation [4][6] - The Fed's cautious approach often results in it falling behind the curve, either by acting too slowly to curb inflation or to boost jobs [7][8] Group 2 - In 2024, the Fed shifted to a dovish monetary policy, cutting the Fed Funds Rate by 1% as inflation appeared to be under control, having decreased from over 8% in 2022 to below 3% [8] - However, inflationary tariffs imposed by President Trump have hindered further rate cuts, with the effective tariff rate rising to 18% from 2.4% in January [9] - The increase in tariffs has led to an estimated average price rise of 6.14% on thousands of goods, exacerbating inflationary pressures [9]

Core Insights - Home builder stocks experienced significant gains due to shifting expectations of a Federal Reserve interest rate cut, marking their best performance since summer [1][2] - The iShares U.S. Home Construction ETF and the State Street SPDR S&P Homebuilders ETF rose by 5.7% and 5.4% respectively, indicating a strong market response [2] - Despite the positive movement, the home building industry has faced challenges this year, including high rates and prices deterring buyers, leading to a 4.2% decline in the iShares ETF year-to-date, while the State Street fund saw a slight increase of 0.3% [3]

Close Key Takeaways The odds of the Federal Reserve lowering borrowing costs in December have suddenly flipped from unlikely to more likely than not after the words of a key federal official. John Williams, president of the Federal Reserve Bank of New York, shook up the outlook for the Fed's key interest rate Friday. He made comments indicating he was open to lowering the fed funds rate at the next meeting of the Federal Open Market Committee in December to help bolster the job market.His remarks made a ra ...