Market View: Week of Dec. 12, 2025

ECONOMIC REVIEW¹

The Federal Reserve (Fed) cut interest rates by 0.25%, bringing the target range to 3.50% - 3.75%.

• This marks the third consecutive rate cut in 2025, with a combined 1.75% of rate cuts since September 2024.

• Nine Fed board members voted to support the rate cut of 0.25%, two members voted for no cut, and one member voted for a 0.50% cut.

• In its updated economic projections for next year, the Fed increased its GDP forecast from 1.8% to 2.3% and lowered its inflation forecast from 2.6% to 2.4%.

• Fed Chairman Jerome Powell noted in his press conference that the Fed is well positioned to wait and see how the economy evolves, noting that the threshold for additional rate cuts would be higher moving forward.

The Job Openings and Labor Turnover Survey (JOLTS) pointed to a jobs market that was little changed in October.

• Job openings rose by 12,000 to 7.670 million, following a 431,000 increase in September.

• The quits rate was little changed at 1.8% but over the year total job quits have fallen by 276,000.

• Similarly, the layoff rate was virtually unchanged at 1.2%.

Initial weekly jobless claims increased to 236,000, surpassing the consensus expectation of 220,000.

• However, continuing jobless claims fell to 1.838 million, marking their lowest point in eight months.

• It’s important to note that claims data has historically been volatile around year-end holiday periods, such as during the Thanksgiving week.

How does the most recent economic data impact you?

Most labor market data points to a still-stable but slowing employment environment, with job openings and layoffs largely unchanged, supporting income stability for most workers. Average hourly wage growth, when adjusted for inflation, has been positive for 29 consecutive months, helping support consumer spending and economic growth.

After delivering three rate cuts this year, the Federal Reserve will likely remain on hold for the next few months as it assesses continued economic data, unless there is a deterioration in labor market conditions.

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A LOOK FORWARD¹

This week investors will be closely watching the November Consumer Price Index (CPI) report, October retail sales data, and the nonfarm payrolls report for October and November.

How does this week’s slate of economic data impact you?

• Inflation is expected to tick up higher to 3.1% as tariff-related costs continue to filter through the economy.

• Preliminary data indicates that consumer spending remains resilient; however, with the latest retail sales report reflecting October activity, a seasonal slowdown may emerge in the interim period between back-to-school purchases and the start of holiday spending.

• Heightened attention will be paid to the jobs report, as it incorporates two months of data following delays caused by the government shutdown. While the unemployment rate is expected to remain at 4.4%, investors will be closely focused on underlying job creation trends for signs of reacceleration.

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MARKET UPDATE²

Market Index Returns as of 12/12/2025	WTD	QTD	YTD	1 YR	3 YR	5 YR
S&P 500	-0.61%	2.33%	17.51%	14.28%	21.04%	14.94%
NASDAQ	-1.61%	2.49%	20.87%	17.16%	28.20%	14.23%
Dow Jones Industrial Average	1.10%	4.85%	15.84%	12.47%	14.57%	12.17%
Russell Mid-Cap	0.56%	1.31%	11.87%	7.14%	13.23%	9.45%
Russell 2000 (Small Cap)	1.21%	4.95%	15.85%	10.19%	13.29%	7.37%
MSCI EAFE (International)	0.85%	3.46%	29.47%	26.33%	15.44%	9.24%
MSCI Emerging Markets	0.43%	3.57%	32.09%	28.43%	15.68%	4.55%
Bloomberg Barclays US Agg Bond	-0.20%	0.56%	6.73%	5.97%	3.77%	-0.41%
Bloomberg Barclays High Yield Corp.	-0.13%	0.73%	8.00%	7.33%	9.05%	4.57%
Bloomberg Barclays Global Agg	0.03%	-0.23%	7.66%	6.39%	3.15%	-2.11%

OBSERVATIONS

• Major U.S. large-cap indices finished mixed on the week, as weakness in large-cap tech weighed on broader benchmarks, but other areas of the market saw positive performance. The Nasdaq declined for the week (-1.61%), followed by the S&P 500 (-0.61%), while the Dow Jones (+1.10%) finished positive.

• Small cap (+1.21%) and mid-cap (+0.56%) stocks also finished positive for the week, benefitting from improved sentiment following the Fed’s rate cut.

• International markets also posted positive returns on the week. Developed markets rose +0.85% while emerging markets posted a return of +0.43%.

• Domestic and international fixed income indices were mixed for the week as interest rates remained largely unchanged. The U.S. Aggregate Bond Index dropped -0.20% while high yield corporate bonds declined -0.13%. International bonds also experienced muted returns for the week and finished up +0.03%.

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BY THE NUMBERS

At Least 15 Killed in Mass Shooting at Hanukkah Event on Sydney’s Bondi Beach
A pair of father-and-son gunmen killed at least 15 people in a mass shooting at a Hanukkah celebration on Bondi Beach in Sydney, Australia, on Sunday, according to officials. At least 42 people have been hospitalized. The attack occurred around 6:45 p.m. local time on Sunday, when emergency services were called to the beach after reports of shots fired, NWS police also said. Hundreds of people had gathered at the popular beach for Chanukah by the Sea, an event celebrating the start of Hanukkah, the annual Jewish festival.

The attack is the first deadly mass shooting in Australia since 2022, when six people, including two police officers, were shot in a suspected ambush at a property as officers responded to a missing person's report. Mass shootings are rare in Australia, largely due to the country's strict gun laws. The country implemented some of the world's toughest gun laws after its worst ever mass shooting in 1996, when a lone gunman killed 35 people at a café and tourist site in Tasmania's Port Arthur.³

Powerball’s Second-Biggest Jackpot of the Year Climbs to $1.1 Billion
The Powerball jackpot rose to an estimated $1.1 billion after there were no winners in Saturday’s night drawing. It’s the second-largest jackpot this year and the 12th to cross the $1 billion threshold in the past five years. The winning numbers were 1, 28, 31, 57 and 58 with a Powerball of 16. While no one took home the jackpot, five ticket holders across the country won $1 million and two ticket holders won $2 million, according to Powerball. The largest jackpot this year was in September, valued at $1.787 billion before taxes. That went to two winners from Missouri and Texas who split the prize. This jackpot’s lump sum is $503.4 million before taxes, a growth of over $74 million since Wednesday. The odds of winning Powerball’s jackpot are 1 in 290.2 million. The next drawing is set for tonight at 10:59 p.m. ET.⁴