Investor Sentiment Update (Not as Bullish as One Would Think)

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What’s in Today’s Report:

  • Sentiment Update: Not Nearly as Bullish as One Would Think
  • Case-Shiller Home Price Index – An Upside Surprise
  • December FOMC Meeting Takeaways

U.S. futures are lower along with global markets after a mostly quiet night of news as the solid 2025 stock market advance continues to be digested into year-end.

Economically, China’s CFLP Composite PMI rose to 50.2 in December from 49.5 in November vs. (E) 49.7 but the strong data print failed to generate any market enthusiasm overnight.

Today, there is one final noteworthy economic report before the end of the year: Jobless Claims (E: 218K) and investors will be looking for a Goldilocks print to shore up soft-landing expectations.

Additionally, the Treasury will hold auctions for 4-Week, 8-Week and 4-Month Bills at 11:30 a.m. ET and markets will want to see healthy demand to support dovish Fed policy expectations for 2026.

Finally, there are no Fed speakers today and the bond market will close early (2:00 p.m. ET) ahead of the New Years Holiday as markets cap off another solid year of stock market returns.

 

The Value of International Investing Revisited

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What’s in Today’s Report:

  • An Interesting Table to Show Clients: The Value of International Diversification
  • Don’t Dismiss Tax-Loss Harvesting This Year

Stock futures are mildly lower as year-end profit taking continues while global equity markets were little changed overnight amid mostly quiet financial market news wires.

Economically, South Korean data was positive as Industrial Production steadied and Retail Sales beat estimates.

Looking into today’s session there are a handful of “second-tiered” economic reports including the Chicago PMI (E: 39.5), the Case-Shiller Home Price Index (E: 1.1%), and the FHFA House Price Index (E: 0.1%) but none are likely to materially move markets.

There is a 6-Week Treasury Bill auction at 11:30 a.m. ET. Yesterday’s short-duration Treasury auctions saw yields come off their intraday lows which appeared to weigh on stocks modestly, a dynamic that could repeat itself today.

Finally, there are no Fed speakers today, however, the December FOMC meeting minutes will be released at 2:00 p.m. ET which will likely be the most widely-followed catalyst of the day as traders assess still uncertain Fed policy rate expectations for 2026.

 

Taking Stock of the Four Pillars of the Rally Ahead of 2026

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What’s in Today’s Report:

  • Taking Stock of the Four Pillars of the Rally Ahead of 2026
  • Weekly Market Preview: Can Year-End Window Dressing Push Stocks Higher?
  • Weekly Economic Cheat Sheet: Another Quiet Week, But The Labor Market Will Stay in Focus

Futures are modestly lower following a mostly quiet weekend of news and as the Trump/Zelensky meeting failed to produce material progress on peace in Ukraine.

Geopolitically, markets were hopeful that the Trump/Zelensky meeting over the weekend would yield a formal agreement, but it did not (just more “progress”) and oil prices are rising moderately (2%) in response.

Notably, gold, silver and copper are all down 2% – 4% pre-market but that’s likely due to year-end positioning.

Today the calendar is generally quiet so focus will be on any signs of geopolitical progress (Russia/Ukraine). Oil remains the best barometer for geo-political concerns and despite the bounce in oil this morning, geo-political concerns from the market remain low (despite numerous unsettled situations including Russia/Ukraine, China/Taiwan and, now, Venezuela).  There is also one economic report today, Pending Home Sales (E: 0.9%), but that shouldn’t move markets.

 

A Historical Look at Bubbles (Chart)

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What’s in Today’s Report:

  • A Historical Look at Bubbles (Chart)

Futures are little changed in quiet trading following the Christmas holiday, as most European markets are closed for St. Steven’s Day.

There was no notable foreign economic out overnight.

On AI, Nvidia announced a partnership with AI Groq that is being positive received by markets (and boosting AI Enthusiasm).

Today should be a quiet trading day barring any geopolitical surprises as there are no economic reports, no meaningful earnings nor any Fed speak.

Hard vs. Soft Data: A Growing Economic Disconnect

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What’s in Today’s Report:

  • Hard vs. Soft Data: A Growing Economic Disconnect
  • Durable Goods and GDP Data Takeaways

U.S. equity futures are modestly lower in thin holiday trade as this week’s market advance to fresh all time highs is digested amid mostly quiet newswires.

Economically, Taiwan Industrial Production rose 16.42% in November, up from 14.5% in October but the data is having a limited impact on markets this morning.

Today, there is one noteworthy economic release ahead of the bell: Jobless Claims (E: 225K) and markets will be looking for ongoing resilience in the labor market via a steady to lower than expected headline print to help shore up soft landing hopes.

The Treasury will hold a 4-Week and 8-Week Bill auction at 11:30 a.m. ET and a 7-Yr Note auction at 1:00 p.m. ET, and as has been the case recently, the stronger the demand the better.

There are no Fed officials scheduled to speak today and no noteworthy earnings releases which will result in a likely quiet holiday trading session with the NYSE closing early at 1:00 p.m. ET.

 

New ETFs for Your Watchlist (November Launches)

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What’s in Today’s Report:

  • New ETFs for Your Watchlist (November Launches)

U.S. futures are flat while overseas equity markets were little changed overnight amid mostly quiet newswires and thinning attendance ahead of the Christmas holiday with focus on the slew of U.S. economic data due out today.

There were no noteworthy economic reports overnight and limited market moving headlines.

Looking ahead to today’s session, focus will be on the long list of economic reports due to be released in the U.S., including Durable Goods Orders (E: -1.5%), Q3 GDP (E: 3.2%), Industrial Production (E: 0.1%), Consumer Confidence (E: 91.9), and the Richmond Fed Manufacturing Index (E: -7.0).

There are no Fed officials scheduled to speak today, however there is a 5-Yr Treasury Note auction at 1:00 p.m. ET that could shed light on investors’ outlook for Fed policy (the stronger the demand, the better).

Bottom line, with thinning attendance and light volumes given the holiday trading week, markets are likely to remain quiet today, however, if economic data meaningfully misses expectations and weighs on growth expectations, a decent pullback could easily occur.

 

Sevens Report Q4 ’25 Quarterly Letter Coming Next Friday  

It was another strong year for stocks, but it will be a different environment as we start 2026 with 1) Concerns about an AI bubble rising, 2) The Fed rate-cutting cycle potentially ending and 3) The unemployment rate hitting a multi-year high.

Those are factors that could make 2026 more volatile than expected and we will address those risks (and celebrate 2025’s strong performance) in the upcoming Q4 Sevens Report Quarterly Letter).

The letter will be delivered to subscribers next Friday, January 2nd. 

The Sevens Report Quarterly Letter is a turnkey client communications solution. We use our strength (writing about the markets) to help you:

  • Save time (an average of 4-6 hours per quarterly letter)
  • Show you’re on top of markets with impressive, compelling market analysis and
  • Strengthen client relationships with little-to-no work from you!

You can view our Q3 ’25 Quarterly Letter here.

To learn more about the product (including price), please click this link and if you’re interested in subscribing, please email info@sevensreport.com.

 

Can the Market Rally Without AI and a Dovish Fed?

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What’s in Today’s Report:

  • Can the Market Rally Without AI and a Dovish Fed?
  • Weekly  Market Preview: Santa Rally On?
  • Weekly Economic Cheat Sheet: More Insight on Growth

Futures are marginally higher mostly on momentum from Friday’s rally and following a quiet weekend of news, as AI linked tech stocks continued to rebound.

Both gold and silver hit new all-time highs on rising geopolitical tensions as U.S. forces boarded another oil tanker bound for Venezuela, further increasing tensions.

Economically, the only notable report overnight was United Kingdom Q3 GDP, which met expectations rising 0.1% q/q and 1.3% y/y.

Market and economic calendars are mostly quiet this week and that includes today as there are no notable economic reports or Fed speakers.  That said, geo-politics remains a potential market mover this week, if we see a further increase in tensions between the U.S. and Venezuela.

 

MMT Chart (December Edition)

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What’s in Today’s Report:

  • MMT Chart (December Edition)

Futures are modestly higher on momentum from Thursday’s rally and as the BOJ rate decision was no worse than feared

The Bank of Japan hiked rates by 25 bps, as expected, but gave no indication when rates might rise again and the yen weakened 1% vs. the dollar.

Today focus will remain on economic data via another important inflation report, the Core PCE Price Index (E: 0.2% m/m, 2.8% y/y) and some growth data: Existing Home Sales (E: 4.15 million), Consumer Sentiment (E: 53.4).

The best outcome for stocks remains that the data generally hits expectations and it’s not so good it encourages the hawks to push back on further rate cuts, nor so weak it raises growth concerns.  Most of the data we’ve received this week (and really the last few weeks) has been that way and Goldilocks data is absolutely helping support this market.

 

December Market Multiple Table – Deterioration Across Market Influences

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What’s in Today’s Report:

  • December Market Multiple Table – Deterioration Across Market Influences

Futures are seeing a solid rebound thanks to strong tech earnings and positive AI news.

Micron (MU) beat earnings estimates (stock up 11% pre-open) and, more importantly, gave robust guidance and that’s helping to reinforce AI Enthusiasm and lift tech and the entire market this morning.

Today will be a busy day of central bank decisions and economic data.  The most important economic report today is CPI (E: 0.3% m/m, 3.1% y/y), followed by Jobless Claims (E: 225K) and Philly Fed  (E: 2.2).  CPI needs to come in at or under expectations to push back on the hawkish Fed narrative and help support stocks.  Other economic data, meanwhile, needs to stay solidly positive to imply stable economic activity.

On the central bank front, we get a BOE Rate Decision (E: 25 bps cut) and ECB Rate Decision (E: No change) and as long as there are no hawkish surprises from either, they shouldn’t move markets.

Finally, on the earnings front, some reports we’re watching today include:  ACN ($3.74), KMX ($0.32), DRI ($2.09), NKE ($0.37), FDX ($4.05), KBH ($1.79).

 

A “Santa Rally” Chart for Clients

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What’s in Today’s Report:

  • An Interesting Chart to Show Clients: Santa Tends to Arrive in the Second Half of December
  • Economic Data Takeaways: November BLS, October Retail Sales, & December Flash PMIs

Futures are higher as cooler-than-anticipated inflation data in Europe is offsetting an uptick in geopolitical tensions between Russia and the West as leaders jawbone about ceasefire negotiation details.

Economically, Eurozone CPI cooled to 2.1% vs. (E) 2.4% while U.K. CPI fell to 3.2% vs. (E) 3.4%, both of which supported dovish money flows overnight.

Looking into today’s session, we will get another look at the health of the U.S. consumer ahead of the bell with the November Retail Sales report due to be released (E: 0.2%) while data on Business Inventories (E: 0.2%) will also be reported. The former will be the key economic focus and investors will be looking for a healthy, “Goldilocks” print to support a relief rally.

The Treasury will hold a 4-Month Bill auction at 11:30 a.m. ET and a 20-Yr Bond auction at 1:00 p.m. ET, and the stronger the demand measures are in each, the better for stocks and bonds today.

There are also three notable Fed speakers today: Waller (8:30 a.m. ET), Williams (9:05 a.m. ET), and Bostic (12:30 p.m. ET), and the more dovish their collective tone is, the better for risk assets.

Finally, there are some late season earnings still trickling in with quarterly reports due from JBL ($2.27), GIS ($1.02), TTC ($0.86), and MU ($3.67) today. Obviously, weak earnings could fuel a further decline in equities today while strong results would be well received.