Post-Christmas Rise: Where Are Expectations in the Markets?

Market Expectations After the Christmas Holiday

Investors anticipate that the US stock markets will finish 2025 with a strong close. In the remaining trading days after the Christmas holiday, the main indices are expected to approach new upward milestones. At the beginning of the month, there were fluctuations in technology stocks due to concerns about artificial intelligence spending; however, despite this situation, the main indices are on track to close December with an increase.

S&P 500 Index Sets Record

The S&P 500 index drew attention by achieving an all-time high closing on Wednesday before the Christmas holiday. The index is only 1% away from reaching the 7,000 level. Additionally, it is expected that the index will complete its eighth consecutive month in positive territory, representing the longest monthly rising streak since the 2017-2018 period.

Sectoral Differences in Market Performance

In 2025, the S&P 500 is expected to rise by approximately 18%, while the Nasdaq Composite Index is projected to increase by 22%. However, in recent weeks, technology stocks have shown weaker performance, drawing attention. Meanwhile, finance, transportation, healthcare, and small-cap stocks have achieved strong gains. Since the beginning of November, the S&P 500 technology index has declined by over 3%, while noticeable increases have been observed in other sectors.

Year-End Rate Cuts and Market Expectations

Market analysts are focused on signals regarding future interest rate cuts from the Federal Reserve in the last trading days of the year. The Fed has carried out a total of 75 basis points of cuts in its last three meetings in 2025, bringing the policy rate to the range of 3.50%-3.75%. The last interest rate cut decision in December was not unanimous. Differing expectations for the upcoming year are drawing investors' attention.

Conclusion

For investors, 2025 continues to be a critical period for monitoring market dynamics and sectoral changes. If the positive momentum in the markets is not disrupted, an upward trend for stocks is expected to continue.