Stocks Rise in Hopes of Positive US Economic News from the Fed

December 15, 2025

S&P 500 and Other Indexes Show Gains

The S&P 500 Index saw a rise of +0.39% today, while the Dow Jones Industrial Average increased by +0.27%. The Nasdaq 100 Index outperformed both, climbing +0.50%. Additionally, December E-mini S&P futures rose +0.40%, with December E-mini Nasdaq futures increasing +0.47%.

Today’s uptick in stock indexes is partly a recovery from the significant losses experienced last Friday. Lower interest rates and the possibility of an accommodating Federal Reserve policy are providing support, especially with the 10-year T-note yield declining by -3 basis points to 4.16%. This week’s U.S. economic news related to employment and pricing is anticipated to align favorably with the Federal Reserve, which should help boost stock prices.

Fed Director Stephen Milan’s comments have also bolstered the market. He pointed out a positive inflation outlook and indicated that the current policy stance of the Fed may be too tight for the economy.

Economic data released today paints a dovish picture for Fed policy and suggests bullish conditions for stocks. The US Empire Manufacturing Industry General Business Survey for December unexpectedly dropped by -22.6 points to -3.9, falling short of the anticipated 10.0.

On a global scale, disappointing economic trends from China are raising concerns about growth. November’s industrial production in China slowed to +4.8% year-on-year, down from October’s +4.9% and against expectations of +5.0%. Retail sales during the same month rose by only 1.3% year-on-year, significantly below the forecast of +2.9%, marking the slowest growth in nearly three years. Moreover, prices for new homes in China have decreased by 0.39% month-on-month, marking the 30th consecutive month of decline.

Looking ahead, this week’s market attention will be on U.S. economic indicators. Later today, the December NAHB Housing Market Index is projected to rise +1 to 39. On Tuesday, nonfarm payrolls are expected to show an increase of +50,000 for November, with the unemployment rate anticipated to be 4.5%. Average hourly earnings for the month are expected to rise by 0.3% from the previous month and by 3.6% year-on-year. Additionally, retail sales for October are expected to reflect a minor monthly increase of +0.1%, while retail sales excluding autos may rise by +0.2%. The S&P Manufacturing PMI for December is anticipated to dip -0.2 to 52.0. Also, weekly new jobless claims are projected to decrease by 11,000 to 225,000 by Thursday. November’s CPI is expected to show a year-on-year increase of +3.1%, with the core CPI anticipated to be +3.0%. Finally, on Friday, existing home sales are expected to increase by 1.2% month-on-month to 4.15 million units, and the University of Michigan Consumer Confidence Index for December is likely to be revised slightly upward to 53.5.

The market currently prices in a 27% chance that the FOMC might cut the federal funds target range by 25 basis points at its next meeting in late January.

Internationally, stock markets are showing mixed results. The Euro Stoxx50 is up +0.71%, while China’s Shanghai Composite has closed down -0.55%. Japan’s Nikkei Stock Average ended the day down -1.31%.

Interest Rates and Bonds

Today’s T-note with a March 10th expiration has seen a rise of +7 ticks, with the 10-year T-note yield dropping -2.0 basis points to 4.165%. The T-note gains are attributed to the dovish December Empire Manufacturing Survey results, adding to the expectations for the Fed’s policy outlook. However, today’s stock performance is somewhat capping the gains for T-note prices.

The yield curve has steepened lately, indicating a bearish trend for T-note prices. This steepening has occurred since the Fed’s recent announcement regarding its plan to purchase up to $40 billion in short-term Treasury securities monthly to enhance market liquidity. Concerns regarding inflation and the Fed’s autonomy are also pressuring long-term Treasuries.

In Europe, government bond yields are falling. The yield on the 10-year German federal bond is down to 2.840%, showing a decrease of 1.7 basis points. The UK’s 10-year bonds also fell, dropping -2.2 basis points to 4.494%.

Industrial production in the euro area saw a monthly increase of +0.8% in October, which was in line with expectations and noted as the most significant rise in five months.

Market assessments show that the probability of the ECB cutting interest rates by -25 basis points in the next policy meeting is effectively at 0%.

U.S. Securities Movements

KLA Corp (KLAC) has jumped over +4%, becoming a leader among chipmakers following Jefferies’ upgrade recommendation. Micron Technology (MU) and Lam Research (LRCX) are also seeing gains of more than +2%. Other notable rises include Applied Materials (AMAT), AMD, NXP Semiconductors NV (NXPI), NVIDIA (NVDA), and ASML Holdings NV (ASML), all up more than +1%.

Mining stocks are also performing well, with gold and copper rising over +1% and silver up more than +3%. Consequently, Barrick Mining (B) and Newmont (NEM) have gained over +1%. Hecla Mining (HL) and Freeport-McMoRan (FCX) have seen similar increases.

Immunome (IMNM) surged over +23% after positive results emerged from a Phase 3 trial of valegacestat involving patients with desmoid tumors.

ZIM Integrated Shipping Services (ZIM) has increased by more than +5% following reports that MSC has made a bid to acquire the company.

AKAM Technologies (AKAM) saw a boost of over +4% following a rating upgrade from KeyBanc Capital Markets. Teradyne (TER) followed suit, increasing over +3% after Goldman Sachs raised its rating with a significant price target. CoreBridge Financial (CRBG) is also up more than +3%, while Doximity (DOCS) has jumped over +2% with a new price target set after an upgrade from Morgan Stanley.

Charles River Laboratories (CRL) is up over +2% following a price target upgrade from JPMorgan.

On the downside, ServiceNow (NOW) led decliners in the S&P 500 with a decline of over -9% after being downgraded by KeyBanc Capital Markets. ARM Holdings (ARM) has dropped more than -3% after a downgrade from Goldman Sachs. Entegris (ENTG) follows with a decrease of over -2%, along with LyondellBasell Industries NV (LYB), which is down more than -1% after a downgrade.

Adobe (ADBE) dipped over -1% due to a downgrade from KeyBanc Capital Markets, and Texas Instruments (TXN) is down over -1% following Goldman Sachs’ downgrade, which significantly altered its rating.