Last week (November 24-28, 2025) saw US equities close higher during a shortened holiday trading session, with the S&P 500, Dow Jones, and Nasdaq gaining 3% to 5%, extending the positive performance from the previous week. However, Nasdaq broke its impressive seven-month positive streak, finishing November down 1.45%. The fixed income market experienced a rally as Treasury yields fell 5 basis points across the curve, with corporate credit spreads also tightening.
Growing investor optimism around potential Federal Reserve rate cuts drove market sentiment, following recent dovish comments from policymakers. Economic data remained mixed, with weak consumer confidence offset by improvement in jobless claims, leading investors to increase their expectations for a December rate movement, with a 25bps cut now fully priced in.
The month was characterized by sector rotation, as investors shifted away from technology stocks toward more defensive sectors like healthcare, despite continued AI-related optimism benefiting tech companies. Heightened volatility marked the period as investors reassessed stock valuations while awaiting key economic data that had been delayed due to the recent record-length government shutdown.
