All figures in this article are based on early‑afternoon U.S. trading on Tuesday, November 25, 2025. Levels and percentages may change by the closing bell.
Key takeaways
- Dow leads Wall Street: The Dow Jones Industrial Average is up around 1.2% (roughly 550–570 points), outpacing the S&P 500 (about +0.7%) and the Nasdaq Composite (about +0.4%) in afternoon trading. [1]
- Fed cut odds jump: Fresh economic data and increasingly dovish comments from several Federal Reserve officials have pushed December rate‑cut odds into the low‑to‑mid 80% range, according to futures pricing. [2]
- AI chip war hits Nvidia: Nvidia shares are down nearly 4%, and other chipmakers are under pressure after reports that Meta Platforms may spend billions on Google’s AI chips, challenging Nvidia’s AI dominance. [3]
- Alphabet & Meta rally: Alphabet is trading at or near record highs and moving closer to a $4 trillion market cap, while Meta is one of the day’s biggest boosts to the S&P 500. [4]
- Retail & housing shine: Explosive gains in Kohl’s and Abercrombie & Fitch—each up around 30–35% after strong earnings and upgraded guidance—along with a jump in pending home sales are helping lift consumer and housing‑related stocks. [5]
- Data mix: softer growth, stable inflation, weaker confidence: September retail sales rose just 0.2%, wholesale inflation (PPI) increased 0.3%, and consumer confidence fell sharply to 88.7, reinforcing the narrative of a cooling economy that may justify another Fed cut. [6]
Wall Street extends its rebound as Dow takes the lead
The U.S. stock market is building on Monday’s powerful rebound, but today’s advance has a different flavor.
As of early afternoon Eastern time:
- The Dow Jones Industrial Average is up a bit over 1%, adding roughly 550–570 points and trading just below 47,000. [7]
- The S&P 500 is higher by around 0.7%, hovering in the 6,740–6,760 range. [8]
- The Nasdaq Composite is positive but lagging, up about 0.3–0.4% as weakness in semiconductor names offsets gains in megacap tech. [9]
The advance keeps Wall Street on track for a third straight day of gains, capping a volatile November that has seen a tech‑led selloff, a government shutdown, and now a relief rally fueled by rising expectations of easier policy from the Federal Reserve. [10]
Small‑cap stocks are joining in: the Russell 2000 is up roughly 1.9%, outpacing the large‑cap benchmarks as investors rediscover more domestically focused names that tend to benefit most from lower borrowing costs. [11]
Why stocks are rallying: Fed cut odds and falling yields
The dominant driver for the US stock market today is the sharply higher probability of a Fed rate cut at the December 9–10 FOMC meeting.
- Futures markets now price roughly an 80–85% chance of a 25‑basis‑point cut, up from around 40–50% just a week ago. [12]
- The 10‑year Treasury yield has slipped to around 4.0%, breaking below that psychological threshold for the first time since late October as bonds rally. [13]
Lower yields and rising cut odds are giving equity valuations a fresh tailwind, especially after Monday’s surge that saw:
- The Nasdaq jump 2.7%—its best day since May, closing around 22,872
- The S&P 500 gain 1.6% to roughly 6,705
- The Dow climb 0.4% to about 46,448 [14]
That one‑two punch—a big technical bounce on Monday followed by confirmation from both data and Fed speakers today—helps explain why buyers are still stepping in even after such a strong start to the week.
Mixed economic data: softer consumer, steady wholesale inflation, weaker sentiment
Several long‑delayed economic reports finally dropped this morning, after being postponed by the 43‑day government shutdown. Together, they paint a picture of an economy that’s slowing but not collapsing—a combination markets often interpret as “good enough” to justify easing policy.
Retail sales: momentum cools
- Retail sales rose 0.2% in September, half the 0.4% increase economists had expected and a downshift from August’s 0.6% gain. [15]
- Excluding autos, sales grew 0.3%, roughly in line with forecasts. [16]
The data suggest consumers are becoming more cautious after months of robust spending, especially in more discretionary categories—a development that may ease inflation pressure but also raises concerns about growth heading into the holidays. [17]
Wholesale inflation (PPI): modest but not alarming
- The Producer Price Index (PPI) for final demand increased 0.3% in September, matching expectations after a 0.1% decline in August. [18]
- On a year‑over‑year basis, PPI is up about 2.7%, the same pace as in August. [19]
Most of the increase came from energy prices, while underlying wholesale inflation (excluding food, energy, and trade services) ticked up only 0.1%, a detail that helps reassure investors that inflation is not re‑accelerating even as growth cools. [20]
Consumer confidence: a sharp slide
The biggest red flag in today’s batch of data is consumer confidence:
- The Conference Board’s Consumer Confidence Index dropped to 88.7 in November, down 6.8 points from a revised 95.5 in October and well below economists’ expectations. [21]
The decline reflects worsening views on jobs, incomes, and the overall financial outlook, likely influenced by the shutdown, higher living costs, and lingering economic uncertainty. The expectations sub‑index, which tracks views about the next six months, fell particularly hard—often a precursor to softer spending ahead. [22]
Housing: pending home sales surprise to the upside
Balancing some of that gloom, housing data came in surprisingly strong:
- Pending home sales jumped 1.9% in October, the biggest increase of the year and an 11‑month high in activity, according to the National Association of Realtors. [23]
Lower mortgage rates and pent‑up demand appear to be pulling buyers back into the market, helping explain why housing stocks are among today’s outperformers. [24]
Fed officials lean dovish, pushing markets toward “rate‑cut mode”
Today’s data didn’t arrive in a vacuum. Over the past several days, a chorus of influential Fed officials has signaled growing support for another rate cut in December:
- San Francisco Fed President Mary Daly told the Wall Street Journal she supports a December cut, citing a weakening job market and greater risks to employment than to inflation. [25]
- New York Fed President John Williams—a key ally of Chair Jerome Powell—said he still sees “room for further adjustment” to rates in the near term, comments that traders interpreted as a green light for a December move. [26]
- Fed Governor Christopher Waller has repeatedly backed another quarter‑point cut, arguing there is “no evidence” the labor market is rebounding and that weaker jobs data justify more support. [27]
- Today, Fed Governor Stephen Miran went further, linking the rise in unemployment directly to tight monetary policy and calling for aggressive cuts to avoid further damage to the job market. [28]
Against this backdrop, the softer tone of today’s macro data fits the narrative that the Fed has room to ease one more time this year. Still, not everyone is convinced: some major Wall Street banks remain on the fence or even expect no move in December, especially after a stronger‑than‑expected jobs report earlier this month. [29]
That policy uncertainty is one reason the broader market is up but not euphoric: investors see tailwinds from lower rates, but also recognize that the Fed remains divided and future moves will depend heavily on the next few data releases.
AI chip rivalry rattles Nvidia while Alphabet and Meta surge
The most dramatic stock story of the day is unfolding in the AI chip space.
The Information’s scoop: Meta looks to Google for chips
A report from The Information—cited by several outlets—said Meta Platforms is in talks to spend billions of dollars on Google’s custom AI chips, starting in 2027, and may even rent Google Cloud chips as soon as next year. [30]
That headline has:
- Boosted Alphabet, whose stock hit an intraday record high around $328 and is now up more than 1% as it marches closer to a $4 trillion market cap. [31]
- Pushed Meta shares up roughly 3%, making it one of the top individual contributors to today’s S&P 500 gain. [32]
Nvidia, AMD and the chip complex under pressure
On the flip side, Nvidia—which has dominated the AI chip boom—is under heavy selling pressure:
- Nvidia stock is down roughly 3.5–4%, trading near a two‑month intraday low, as investors digest the possibility that some of Meta’s future chip spending could shift from Nvidia’s GPUs to Google’s TPUs. [33]
- Advanced Micro Devices (AMD) is also sliding, with losses of roughly 6–7% as part of a broader selloff in semiconductor names. [34]
- The Philadelphia Semiconductor Index is down around 0.8%, contrasting sharply with gains in other sectors. [35]
The moves come just days after Nvidia reported stellar earnings that initially failed to sustain the stock’s rally, feeding a growing debate about whether AI leaders have simply run too far, too fast despite their strong fundamentals. [36]
In short, AI remains a key driver of the market—but today, it’s picking winners and losers rather than lifting everything at once.
Retailers and home‑related stocks steal the spotlight
While AI drama grabs the headlines, some of the day’s biggest winners are plain‑vanilla retailers.
Kohl’s and Abercrombie stage massive rallies
- Kohl’s (KSS) has skyrocketed roughly 30–35% after the company reported a surprise profit and raised its full‑year outlook for the second time, now projecting a smaller drop in sales and stronger earnings. [37]
- Abercrombie & Fitch (ANF) has surged by a similar 30–35%, thanks to stronger‑than‑expected earnings and robust demand across its brands. [38]
Both rallies reflect investors rewarding companies that can grow profits in a choppy macro environment, especially as questions about consumer strength intensify.
Other retail movers
- Best Buy is up about 5% after it boosted its profit forecast, citing solid demand in computing, gaming, and mobile phones. [39]
- Dick’s Sporting Goods reversed an early slide to trade higher, as management framed current inventory clearance as “cleaning out the garage” post‑acquisition. [40]
Collectively, these moves have pushed the S&P retail sub‑index more than 2% higher, helping offset weakness in semiconductors. [41]
Housing & airlines join the risk‑on move
RTT News notes airline stocks and housing names among the day’s biggest sector gainers:
- An airline index is up more than 4%,
- A housing sector index is higher by over 3%, helped by the upside surprise in pending home sales. [42]
The combination of lower yields, better housing data and a perceived “soft landing” scenario is drawing money back into economically sensitive areas that had been battered earlier in the fall.
Bonds, dollar, and global markets
The cross‑asset backdrop continues to support U.S. equities:
- U.S. 10‑year yields are hovering around 4.0%, down nearly 4 basis points on the day. [43]
- The U.S. dollar index is modestly weaker, reflecting expectations that U.S. rates will fall sooner rather than later. [44]
- European and Asian markets largely finished higher overnight, setting a positive tone for Wall Street’s open and reinforcing the global risk‑on mood. [45]
With global stocks on track for a third straight day of gains, the U.S. market is once again taking its cues from the interplay between rates, inflation expectations and the AI‑driven growth story.
What to watch next: Thanksgiving trade and the December Fed meeting
With Thanksgiving on Thursday, U.S. markets will be:
- Closed on Thursday, November 27
- Open for a shortened session on Friday, November 28
Traders expect lighter volumes and potentially choppy price action as large institutional desks wind down for the holiday. [46]
Looking beyond this week, the December 9–10 Fed meeting remains the key macro catalyst. Between now and then, markets will be watching for:
- Any further labor‑market data (jobless claims, private payroll indicators)
- Updated readings on inflation, especially the Fed’s preferred PCE gauge
- New clues from Fed speakers about whether December’s likely cut is a “one‑and‑done” or the start of a more extended easing cycle [47]
For now, though, the story of the US stock market today is straightforward:
Rate‑cut hopes are powering stocks higher, the Dow is in the driver’s seat, AI is creating sharp winners and losers, and a batch of “not too hot, not too cold” data is keeping the December cut very much on the table.
This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security.
References
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