The US stock market is positioning for a robust conclusion to 2025, with major indices trading near record levels and the S&P 500 approaching the significant 7,000 milestone. This performance caps off a remarkable third consecutive year of double-digit gains, driven by a three-year bull market primarily fueled by the technology sector and artificial intelligence optimism.

Current Market Performance and Milestones

The S&P 500 has delivered impressive returns of nearly 18.00% in 2025, while the Nasdaq Composite has surged approximately 22.00% for the year. The market is poised for its eighth consecutive month of gains—the longest winning streak since 2017-2018. This momentum follows previous stellar performances of 24.00% in 2023 and 23.00% in 2024.

Latest market data shows mixed individual stock performance:

Sector Rotation and Market Breadth

Despite early December volatility triggered by concerns over artificial intelligence spending, equities have demonstrated resilience through a notable sector rotation. Beyond technology stocks, financials, transportation, healthcare, and small-cap stocks have posted solid returns, reflecting investor movement toward areas with more moderate valuations. This broadening rally suggests a more sustainable market foundation beyond the concentration in tech giants.

Federal Reserve Policy Outlook

Monetary policy remains a critical factor as markets transition into 2026. The Federal Reserve has implemented 75 basis points of rate cuts across three meetings in 2025, bringing the benchmark rate to a range of 3.50%-3.75%. This follows a cumulative 175 basis points of cuts during 2024 and 2025.

Key Federal Reserve considerations include:

Market participants are closely monitoring the timing and magnitude of future rate cuts, with differing projections among Fed policymakers adding uncertainty. The upcoming nomination of a new Fed chair to replace Jerome Powell when his term ends in May 2026 represents a significant factor that could influence trading dynamics.

Corporate Earnings and AI Investment Dynamics

Corporate earnings growth continues to support market valuations, with S&P 500 profits projected to rise over 15.00% in 2026, building on a solid 13.00% increase in 2025. The "Magnificent Seven" technology companies demonstrated exceptional profit growth of 37.00% in 2024, significantly outpacing the 7.00% growth rate for remaining S&P 500 companies.

Artificial intelligence investment remains a key market driver, though questions about returns on AI spending could influence future performance. Companies' ability to deliver expected returns on massive AI capital expenditures will be crucial for maintaining investor confidence and market momentum.

Year-End Market Dynamics

As 2025 concludes, year-end portfolio adjustments and lighter holiday trading volumes are expected to contribute to short-term volatility. However, the underlying strength of the economy and investor confidence in market fundamentals suggest continued resilience as the market enters 2026.

The combination of strong yearly performance, broadening sector participation, and supportive monetary policy positions the US stock market favorably for a strong finish to 2025, though future gains will depend on continued earnings growth, AI investment returns, and Federal Reserve policy decisions.

US stocks advanced as investors anticipated a quick resolution to the government shutdown, which could enable the release of key economic data and potentially strengthen expectations for Federal Reserve interest rate cuts. Market gains were supported by dip buyers maintaining the year-end rally despite ongoing technical volatility in trading.

Meanwhile, the New York Stock Exchange (NYSE) and Nasdaq are set to maintain regular trading hours on Veterans Day, November 11, despite its status as a federal holiday. This decision highlights the stock markets' commitment to providing continuous trading opportunities for investors.

Key Points

• Stock Markets: NYSE and Nasdaq will operate normally on Veterans Day
• Date: November 11
• Holiday: Veterans Day
• Bond Market: Will remain closed
• Current Market Trend: US stocks advancing on shutdown resolution expectations

Market Schedule

About Veterans Day

Veterans Day is a federal holiday in the United States that honors military veterans and commemorates the end of World War I. While many government offices and some businesses observe this holiday by closing, the major stock exchanges have chosen to remain open, ensuring that financial markets continue to function on this day.

This decision by the NYSE and Nasdaq to operate on Veterans Day underscores the importance of maintaining market continuity and providing investors with uninterrupted access to trading, even on federal holidays. It's a reminder of the global nature of financial markets and the need for consistent operation in today's interconnected economy.

Investors should note that while stock markets will be open, the bond market will be closed on Veterans Day. This divergence in market operations could potentially impact trading strategies and liquidity in certain securities, particularly those closely tied to bond market performance.

Current Market Sentiment

The recent advance in US stocks reflects investor optimism regarding a potential quick resolution to the government shutdown. This anticipated resolution is expected to facilitate the release of important economic data, which could in turn influence expectations for Federal Reserve interest rate decisions. The market's upward movement is being sustained by dip buyers who are helping to maintain the year-end rally, despite the presence of ongoing technical volatility in trading.

As always, market participants are advised to plan their trading activities accordingly, taking into account these holiday schedules, current market trends, and potential impacts on market dynamics.