NEW YORK, Dec. 28, 2025, 12:15 p.m. ET — Market Closed (Weekend)
Wall Street is closed Sunday, giving investors a brief pause after a sleepy post-Christmas session that still left the major U.S. stock indexes parked near record territory — and on track to finish 2025 with strong double-digit gains.
The next real test arrives Monday, when the final three trading days of 2025 begin. With liquidity often thin at year-end, headlines can move markets more than usual — and traders will be watching for signs that the “Santa Claus rally” continues, as well as fresh clues on the Federal Reserve’s 2026 path from minutes due this week.
Where the US stock market left off: Dow, S&P 500, Nasdaq close near record highs
In the most recent regular session (Friday, Dec. 26), U.S. stocks finished marginally lower in a quiet, light-volume day as investors drifted back after the holiday break.
- The Dow Jones Industrial Average closed at 48,710.97, down 20.19 points. [1]
- The S&P 500 closed at 6,929.94, down 2.11 points. [2]
- The Nasdaq Composite closed at 23,593.10, down 20.21 points. [3]
Even with the slight dip, all three indexes booked weekly gains. Investopedia calculated the holiday-shortened week’s advances at roughly +1.4% for the S&P 500, +1.2% for the Dow, and +1.2% for the Nasdaq. [4]
Friday’s tape also underscored how thin trading can become in the final stretch of the year. Reuters reported U.S. exchange volume of 10.22 billion shares versus a 20-day average of 15.98 billion. [5] The Associated Press similarly noted NYSE trading was “roughly half” an average day. [6]
Santa Claus rally watch: why year-end price action matters
The late-December seasonal stretch known as the “Santa Claus rally” — typically defined as the last five trading days of the year and the first two of the new year — is now underway. Reuters noted the window began Wednesday and runs through Jan. 5, with investors looking for signs of an upward bias into 2026. [7]
Ryan Detrick, chief market strategist at Carson Group, described Friday as a pause after a strong run: investors were “catching our breath today after the holiday,” he said, while adding that the Santa Claus period still leaves time for upward drift. [8]
That matters because the market is not just trying to end 2025 well — it’s trying to validate optimism that has returned after bouts of volatility tied to AI-related concerns, rates, and geopolitics. [9]
S&P 500 eyes 7,000: what’s powering the late-2025 rally
The S&P 500 is hovering within striking distance of 7,000, a psychological milestone that would mark the first time the index has reached that level. Reuters said the benchmark was about 1% away, after notching a record close ahead of the Christmas holiday. [10]
Strategists also point to the durability of the broader trend. Reuters reported the S&P 500 is on pace for an eighth straight monthly gain, which would be its longest monthly winning streak since 2017–2018. [11]
Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest Wealth Management, summed up the near-term tone: “Momentum is certainly on the side of the bulls.” [12]
Market rotation: investors look beyond mega-cap tech
One of the most important under-the-surface developments is a rotation away from the most crowded parts of the market.
Reuters reported that despite a recent rebound, the S&P 500 technology sector has declined more than 3% since the start of November, while other areas — including financials, transports, healthcare, and small caps — posted solid gains over the same period. [13]
Anthony Saglimbene, chief market strategist at Ameriprise Financial, said the moves suggest rotation toward areas with “more moderate” valuations, alongside a more constructive view of the economy: “There are more investors that are buying in to the narrative that the economy is on pretty solid footing right now,” he said. [14]
On Friday specifically, Reuters said materials led sector gainers while consumer discretionary lagged. [15]
Cross-asset signals: gold and silver surge, oil slips, yields steady
While equities have been calm, other markets have been more animated — and they’re part of the story heading into Monday.
The Associated Press reported that gold and silver continued climbing, with silver up nearly 8% to $77.20 an ounce and gold up 1.1% on Friday. [16] The AP also said U.S. crude oil fell 2.8% and the 10-year Treasury yield edged down to 4.13%. [17]
Reuters linked the strength in precious metals to equity movers, noting U.S.-listed precious metal miners rose as silver and gold touched fresh record highs. [18]
For stock investors, the takeaway is straightforward: if metals keep ripping higher while yields remain rangebound, leadership can shift quickly — especially in thin, headline-driven markets.
The next catalysts: Fed minutes, housing data, jobless claims — plus holiday trading schedule
With stocks closed today, the calendar becomes the main roadmap for what could move markets when trading resumes.
Investopedia flagged a holiday-shortened week with several key releases:
- Monday, Dec. 29: Pending home sales (November)
- Tuesday, Dec. 30: S&P Case-Shiller Home Price Index (October), Chicago Business Barometer (December), December FOMC meeting minutes
- Wednesday, Dec. 31: Initial jobless claims (week ending Dec. 27); U.S. bond markets close at 2 p.m. ET
- Thursday, Jan. 1: New Year’s Day holiday
- Friday, Jan. 2: No major scheduled releases [19]
Investopedia also emphasized that stock markets operate a normal schedule on New Year’s Eve, while both stock and bond markets are closed Jan. 1, 2026. [20] SIFMA similarly lists an early close (2:00 p.m. ET) for U.S. bond markets on Wednesday, Dec. 31, 2025. [21] And the NYSE’s holiday calendar confirms New Year’s Day (Thursday, Jan. 1, 2026) as a market holiday. [22]
Why Fed minutes matter more than usual right now
This week’s minutes land at a moment when markets are trying to handicap 2026 rate cuts and broader financial conditions.
Reuters reported the Fed has lowered its benchmark interest rate by 75 basis points over its last three meetings, to a range of 3.50%–3.75%, and that futures markets have been pricing roughly 50 basis points of additional cuts in 2026. [23] Reuters also noted investors were watching for President Donald Trump to nominate a Fed chair to replace Jerome Powell, whose term ends in May. [24]
That mix — policy expectations plus leadership uncertainty — is why even a “quiet” week can still deliver outsized moves.
2026 outlook: AI spending, earnings breadth, and the Fed’s balancing act
Even as 2025 winds down, strategists are already framing what it would take for another strong year.
In a recent year-ahead analysis, Reuters reported that a fourth straight year of standout gains in 2026 would likely require strong earnings, a dovish Fed, and resilient AI investment. [25] Sam Stovall, chief investment strategist at CFRA, said markets may need “everything firing on all cylinders,” while cautioning that headwinds could limit returns. [26]
Reuters also highlighted expectations for broader earnings strength: S&P 500 earnings are projected up over 15% in 2026 (after a strong 2025), according to Tajinder Dhillon, head of earnings research at LSEG. [27] And Kristina Hooper, chief market strategist at Man Group, pointed to improving earnings growth among the “other” S&P 500 stocks as a key ingredient for double-digit index returns. [28]
On the risk side, Reuters noted concerns about whether AI-related capital spending will deliver returns. Jeff Buchbinder, chief equity strategist for LPL Financial, warned that if companies pull back on guided capex and the market loses confidence in AI investment returns, the year could skew flat or worse. [29]
What investors should know before Monday’s session
With markets reopening Monday and year-end positioning in full swing, here’s what matters most heading into the next bell:
- Expect thinner liquidity — and sharper reactions to headlines. Reuters and Schwab both warned that light trading volumes can exaggerate moves during the holiday stretch. [30]
- Watch the “rotation” tape, not just the mega-caps. Leadership broadening beyond tech (financials, healthcare, transports, small caps) has been a major late-2025 theme. [31]
- Stay focused on rates and the Fed narrative. The week includes FOMC minutes Tuesday and jobless claims Wednesday — releases that can swing expectations about the pace of 2026 cuts. [32]
- Track cross-asset signals (metals, oil, yields). Silver’s surge, steady-to-lower yields, and softer oil can reshape sector leadership quickly — especially in commodities, materials, and miners. [33]
- Know the holiday schedule so you’re not surprised by closures. Stocks are closed Jan. 1, and bonds close early (2 p.m. ET) on Dec. 31. [34]
As 2025’s final sessions approach, the market’s message has been clear: bulls still have momentum — but the path into 2026 may depend less on a single “Magnificent Seven” trade and more on whether earnings breadth improves, the Fed delivers manageable easing, and AI spending proves it can translate into durable profits. [35]
References
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