December S&P 500 E-Mini futures (ESZ25) are up +0.48%, and December Nasdaq 100 E-Mini futures (NQZ25) are up +0.49% this morning, signaling a partial rebound from Friday’s tech-led selloff on Wall Street as investors stepped in to buy the dip at the start of the final full trading week of 2025.
Lower bond yields today are supporting stock index futures.
This week, investors will focus on key U.S. economic data, including monthly employment and inflation figures, comments from Federal Reserve officials, and earnings reports from several high-profile companies.
In Friday’s trading session, Wall Street’s major equity averages closed sharply lower. Broadcom (AVGO) plunged over -11% and was the top percentage loser on the Nasdaq 100 after the software and semiconductor giant’s sales outlook for the AI market fell short of investors’ lofty expectations. Also, Sandisk (SNDK) tumbled more than -14% and was the top percentage loser on the S&P 500 after GF Securities downgraded the stock to Hold from Buy. In addition, Ciena Corp. (CIEN) slumped over -9% after Northland Securities downgraded the stock to Market Perform from Outperform with a $190 price target. On the bullish side, Lululemon Athletica (LULU) surged more than +9% and was the top percentage gainer on the S&P 500 and Nasdaq 100 after the retailer posted upbeat Q3 results and raised its full-year guidance.
Cleveland Fed President Beth Hammack said on Friday that she would prefer interest rates to be somewhat more restrictive to continue putting pressure on inflation, which remains too high. “Right now, we’ve got policy that’s right around neutral,” Hammack said. Also, Kansas City Fed President Jeffrey Schmid said he dissented against the latest FOMC’s decision to cut interest rates because inflation remains “too high” and policy should stay modestly restrictive to contain it. At the same time, Chicago Fed President Austan Goolsbee said he is penciling in more rate cuts for 2026 than many of his colleagues, but dissented against a rate cut at the December meeting because he wanted to wait for additional inflation data. In addition, Philadelphia Fed President Anna Paulson said, “On net, I am still a little more concerned about labor market weakness than about upside risks to inflation.”
Meanwhile, U.S. rate futures have priced in a 75.6% probability of no rate change and a 24.4% chance of a 25 basis point rate cut at the next central bank meeting in January.
This week, a slew of delayed U.S. economic data will give investors and policymakers a long-awaited snapshot of the labor market and broader economy. The jobs report and consumer price index for November will be the main highlights, starting to shape the outlook for interest rates in 2026. U.S. retail sales data for October will also draw attention, along with preliminary purchasing managers’ surveys on manufacturing and services sector activity. Other noteworthy data releases include the U.S. Philadelphia Fed Manufacturing Index, Initial Jobless Claims, Business Inventories, Existing Home Sales, and the University of Michigan’s Consumer Sentiment Index.
Market participants will also parse comments from several Fed officials, with the key question now being how far and how fast interest rates will fall in 2026. The Fed has projected just one rate cut next year, but many in the market anticipate more, with U.S. money markets fully pricing in two reductions. Fed Governors Stephen Miran and Christopher Waller, along with New York Fed President John Williams and Atlanta Fed President Raphael Bostic, are scheduled to speak this week.
In addition, several notable companies, including chipmaker Micron Technology (MU), advisory firm Accenture (ACN), sneaker maker Nike (NKE), and shipping giant FedEx (FDX), are set to report their quarterly figures this week.
Today, investors will focus on the New York Fed-compiled Empire State Manufacturing Index, which is set to be released in a couple of hours. Economists expect the December figure to come in at 9.8, compared to 18.7 in November.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.170%, down -0.60%.
The Euro Stoxx 50 Index is up +0.51% this morning, starting a week filled with major central bank decisions and delayed U.S. economic data on an upbeat note. Bank and mining stocks outperformed on Monday. At the same time, healthcare stocks fell, with Sanofi (SAN.FP) sliding over -3% as expectations grew that the U.S. Food and Drug Administration would delay a decision on its multiple sclerosis drug, tolebrutinib. Data from Eurostat released on Monday showed that Eurozone industrial production growth picked up in October, as early signs of a recovery in Germany helped ease concerns over the impact of higher U.S. tariffs on the bloc’s factories. Meanwhile, market participants are bracing for a series of monetary policy decisions from central banks across the region this week, including those from the European Central Bank and the Bank of England. The ECB is widely expected to leave the deposit rate unchanged at 2.00%, and to keep it there throughout 2026. Attention will center on the ECB’s GDP and inflation forecasts. At the same time, the BoE is widely expected to cut interest rates by 25 basis points to 3.75% as it looks to support a sluggish economy now that the long-awaited November budget is out of the way. Key data points in the euro region this week include flash readings of purchasing manager indexes and Germany’s closely watched Ifo business confidence gauge. Geopolitical developments also remain in focus, with investors keeping an eye on peace talks on Ukraine. U.S. special envoy Steve Witkoff said progress was made during talks in Berlin on Sunday, with discussions between the U.S. delegation and Ukrainian President Volodymyr Zelenskyy resuming there on Monday.
Eurozone’s Industrial Production data was released today.
Eurozone’s October Industrial Production rose +0.8% m/m and +2.0% y/y, stronger than expectations of +0.7% m/m and +1.9% y/y.
Asian stock markets today closed in the red. China’s Shanghai Composite Index (SHCOMP) closed down -0.55%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -1.31%.
China’s Shanghai Composite Index closed lower today as downbeat economic data from the country and rising default risks at property developer Vanke dampened sentiment. Property stocks plunged on Monday, with China Vanke sliding about -3% after its bondholders rejected a one-year extension of a bond payment due Monday, heightening default risks for the state-backed developer. Semiconductor stocks also slumped after reports emerged that Nvidia is weighing an expansion of H200 chip production following strong demand from China. Risk appetite was further dampened by data showing China’s economic momentum slowed further in November, with all major indicators falling short of expectations. The National Bureau of Statistics said China’s factory output growth slowed to a 15-month low in November, retail sales growth was the weakest since the Covid period, and investment weakened further. Also, China’s property downturn worsened in November, with investment, home prices, and sales all notching steeper declines. The latest data back the case for Beijing to ramp up policy support at the start of 2026. In other corporate news, CMOC Group rose about +2% after the mining giant announced it was buying several Brazilian gold mines from Canada’s Equinox Gold in a deal valued at more than $1 billion.
The Chinese November Industrial Production rose +4.8% y/y, weaker than expectations of +5.0% y/y.
The Chinese November Retail Sales rose +1.3% y/y, weaker than expectations of +3.0% y/y.
The Chinese Fixed Asset Investment fell -2.6% y/y in the January-November period, weaker than expectations of -2.4% y/y.
The Chinese November Unemployment Rate was 5.1%, in line with expectations.
Japan’s Nikkei 225 Stock Index closed sharply lower today, tracking Wall Street’s losses on Friday. Technology stocks led the declines on Monday. At the same time, bank stocks advanced ahead of an anticipated interest rate hike by the Bank of Japan this week, with those expectations reinforced on Monday by the central bank’s quarterly Tankan survey. A BOJ survey showed that a key gauge of business sentiment in Japan reached a 4-year high in the fourth quarter as trade-related anxiety eased. The gauge reflects the percentage of companies reporting favorable business conditions minus those reporting unfavorable conditions. Daiwa Securities economist Kento Minami said the Tankan survey points to solid momentum in wage trends, a key factor in determining the central bank’s next interest rate hike. Meanwhile, the BOJ said on Monday that most Japanese companies it surveyed expect to raise wages in fiscal 2026 at roughly the same pace as this year, even as many brace for a tariff-related hit to profits. The special wage report comes as Gov. Ueda watches for early indications that this year’s strong pay gains will carry over into next year as inflation picks up. Investor focus this week is squarely on the BOJ’s monetary policy decision, where the central bank is widely expected to raise its benchmark rate by 25 basis points to 0.75%, marking the first hike since January. Market participants will closely watch Ueda’s post-meeting press conference for clues on how many additional rate hikes may be ahead. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +7.79% to 28.77.
The Japanese Tankan Large Manufacturers Index stood at 15 in the fourth quarter, in line with expectations.
The Japanese Tankan Large Non-Manufacturers Index came in at 34 in the fourth quarter, weaker than expectations of 35.
Pre-Market U.S. Stock Movers
Most chip stocks are moving higher in pre-market trading, with Marvell Technology (MRVL) and Intel (INTC) rising over +1%.
KLA Corp. (KLAC) gained more than +2% in pre-market trading after Jefferies upgraded the stock to Buy from Hold with a price target of $1,500.
Dollar General (DG) advanced over +2% in pre-market trading after JPMorgan upgraded the stock to Overweight from Neutral with a price target of $166.
iRobot (IRBT) plummeted over -82% in pre-market trading after the Roomba maker filed for bankruptcy on Sunday.
Texas Instruments (TXN) and Arm Holdings (ARM) fell more than -3% in pre-market trading after Goldman Sachs downgraded both stocks.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Monday - December 15th
Champions Oncology (CSBR) and Ocean Power (OPTT).
On the date of publication, Oleksandr Pylypenko 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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