State of Market: Open 11/25/25
At the open: Dow and small caps advance, tech eases; yields steady-to-softer as energy and nat gas slide
Fed path and leadership speculation frame the Thanksgiving-week tone; AI supply-chain crosscurrents pressure mega-cap tech while bond proxies and defensives catch a bid
TendieTensor.com State of Market Open
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Markets opened with a split tone on Tuesday as investors balance monetary-policy expectations, leadership chatter at the Federal Reserve, and shifting currents within the AI and energy trades. The Dow proxy (DIA) and small caps (IWM) are firmer out of the gate while the tech-heavy QQQ lags, reflecting a modest rotation back toward cyclicals, financials, and healthcare amid a mild bid for duration in bonds.
At 9:30 a.m. ET, SPY is essentially flat to slightly lower versus Monday’s close, trading fractionally below its prior mark. QQQ is off about a quarter of a percent from yesterday’s finish, while DIA is up roughly four-tenths of a percent. IWM is also higher by a similar magnitude, hinting at some early breadth beyond the mega-cap complex.
Macro backdrop: yields, inflation, and expectations
Treasury yields remain broadly anchored to softer, with the 10-year at 4.06% and the 2-year near 3.51% as of the latest available readings. The curve is modestly positively sloped from 2s to 10s and rises further to the long bond at 4.71%, suggesting term premia and longer-run inflation/rate risks remain embedded even as front-end expectations ease. Five-year and one-year tenors both sit at 3.62%, below the 10-year, reinforcing a narrative of a gentler policy path relative to earlier in the year.
The latest CPI prints in the dataset are for September (headline index 324.368; core 330.542). While year-over-year changes are not provided, breakeven and model-based measures of inflation expectations help fill in the picture: market-based 5-year and 10-year expectations are 2.36% and 2.31%, respectively, with the 5y5y forward at 2.25%. A model-based 1-year expectation sits near 2.74%, consistent with a view that near-term disinflation may continue, but not linearly.
Policy remains at the forefront. MarketWatch highlights that investors are watching “critical clues” on job openings, wages and labor-market perceptions as Fed hawks and doves debate the trajectory into year-end. Separate coverage argues that a December rate cut, once doubtful, now appears more likely given the evolution of data and Fed rhetoric, and Bloomberg notes gold steadied as New York Fed President Williams signaled a near-term cut. Meanwhile, U.S. Treasury Secretary Scott Bessent told CNBC over the weekend that he does not see a 2026 recession, and this morning CNBC reports Bessent sees a “very good chance” President Trump names a new Fed chair before Christmas—another potential driver of rates volatility into year-end as the market handicaps continuity versus change.
Equities: index-level picture and sector rotation
The index complexion reflects these cross-currents. SPY is fractionally lower versus Monday’s 668.73 close, QQQ is down about 0.24%, while DIA is up around 0.37% and IWM higher roughly 0.39%. The pattern fits a modest factor rotation away from AI-levered mega-cap growth toward cyclicals and domestically sensitive segments, a theme echoed in recent reporting that “stocks are trading on a knife’s edge” ahead of December’s Fed decision.
Within sectors, early prints show:
- XLK (technology) easing about 0.9% versus Monday’s close. Recent articles highlight an AI trade reset as Alphabet’s custom-chip efforts draw interest—including a potential Meta data-center tie-up—raising the prospect of more formidable competition for third-party accelerators. MarketWatch notes Alphabet’s stock has been rising on this theme, while Nvidia and AMD shares have faced pressure on the idea of a more diversified AI silicon landscape. That narrative is showing up in the sector tape today.
- XLF (financials) up roughly 0.4%. A softening in longer-dated yields can be a two-edged sword for net interest margins, but steadier rates and improving risk sentiment often support financials into year-end. The small-cap bid also tends to correlate with regional-bank appetite.
- XLV (health care) up about 0.4%. Stock-specific news is mixed in the space: MarketWatch flags a positive trial result for a Novo Nordisk weight-loss candidate even as a separate oral GLP-1 failed to show benefit in Alzheimer’s, producing a push-pull across obesity and neurology narratives.
- XLE (energy) slightly higher at the open despite weakness in crude-linked products, suggesting stock-level and dividend support may be offsetting commodity headwinds.
Beyond the sector aggregates, company news remains active. MarketWatch reports Alibaba’s revenue topped expectations with the company emphasizing its AI capabilities; the stock “spiked 5%” Tuesday morning. Multiple pieces underscore shifting leadership within AI: Jim Cramer suggests Alphabet’s Gemini poses a serious challenge to OpenAI, and additional coverage frames Google’s AI momentum as a potential overhang for parts of the semiconductor complex. Another MarketWatch piece queries whether the “Magnificent Seven” era is ending, with a renewed focus on idiosyncratic drivers for Nvidia, Microsoft, and Apple. On the consumer side, CNBC notes Kohl’s named Michael Bender as permanent CEO after a turbulent year, and MarketWatch cites Burlington’s sales miss due in part to warm weather impacting traffic. Tesla remains in the headlines after reports of a three-year sales low in China, even as Elon Musk touted progress on in-house AI chips.
Bonds: bid to duration as policy odds shift
Treasuries are modestly bid and the ETF proxies are reflecting that. TLT is up roughly 0.3% versus Monday, IEF is up about 0.1%, and SHY is essentially flat. The 10-year yield anchored near 4.06% against a softer front end is consistent with the “December cut more likely” narrative highlighted by MarketWatch and with Bloomberg’s note on dovish signaling from Williams. The curve’s positive slope from 2s to 10s to 30s suggests longer-run uncertainty remains, but the near-term rates impulse is easing, a dynamic that typically supports rate-sensitive equities and precious metals while tempering the U.S. dollar.
Commodities: precious metals steady, crude and gas slide
Gold (GLD) is fractionally higher versus Monday, building on the stabilizing impulse described by Bloomberg in the context of a potential near-term Fed cut. Silver (SLV) is a touch lower, continuing a recent pattern of relative underperformance to gold during policy transitions. Oil is pressured: USO is down a little more than 2% relative to yesterday, dovetailing with Bloomberg’s latest oil round-up noting last week’s sharp losses and ongoing concerns about ample supply. Natural gas weakness is more acute at the open, with UNG off about 5%, reflecting seasonal and storage dynamics and, potentially, weather-related demand skepticism. Broad commodities (DBC) were last unchanged versus Monday’s close, though live quotes indicate a softer bias consistent with the energy complex.
FX and crypto: euro firmer, crypto softer
EURUSD is modestly firmer versus its stated open, consistent with the combination of a bid to Treasuries and the market’s leaning toward easier Fed policy. In crypto, Bitcoin (BTCUSD) trades around $87,100, down about 1.4% from its provided open level, and ether (ETHUSD) is off roughly 0.9%. MarketWatch’s recent coverage framed bitcoin’s pullback from October highs as an emerging barometer for broader risk sentiment; Deutsche Bank’s “Tinkerbell effect” note underscores how shifts in collective belief can exacerbate crypto volatility. The day’s macro tone—softer yields, tech wobbles, and commodity softness—is consistent with the mixed-to-cautious setup for high-beta assets.
Notable corporate and thematic movers from the news flow
- Fed and policy: CNBC reports that Secretary Bessent sees a strong chance of a new Fed chair nomination before Christmas, injecting a fresh source of policy uncertainty into an already consequential December. MarketWatch surveys the stakes ahead of the meeting, while another piece argues a cut is increasingly likely. These factors appear to be supporting duration and precious metals early.
- AI platform realignment: MarketWatch highlights Alphabet’s potential chip collaboration with Meta for data centers, with knock-on pressure for Nvidia and AMD as investors contemplate a more fragmented accelerator landscape. Cramer separately calls out Gemini’s threat to ChatGPT. These developments map to the early underperformance in XLK.
- China and U.S. growth levers: Alibaba’s better-than-expected revenue, tied to AI momentum, provides a counterpoint to Tesla’s softer China sales narrative. The mixed picture helps explain the crosscurrents between QQQ and the broader indices.
- Energy supply: Bloomberg’s oil recap points to a market reassessing supply scenarios and geopolitical risk premia; that context aligns with the downdraft in USO and UNG at the open.
- Consumer and retail: MarketWatch and CNBC pieces ahead of the holiday shopping stretch focus on promotions and value positioning, with Burlington’s miss and Kohl’s leadership change illustrating the operational dispersion within retail. Lower inflation-adjusted gasoline costs into Thanksgiving, per MarketWatch, may help sentiment, though food inflation remains a pressure point for households.
Outlook and what to watch
With a shortened holiday week, liquidity can exaggerate moves, but the macro signposts are clear: watch labor demand gauges, wage growth, and consumer conditions as investors calibrate the odds of a December rate cut. Any developments around Fed leadership, as flagged by CNBC’s Bessent coverage, could spark curve and risk-asset volatility. Within equities, leadership is fluid: AI infrastructure competition and in-house silicon roadmaps are reshaping expectations for margins and capex cycles across cloud, semis, and platform companies. Energy’s softness bears monitoring into the next set of supply-demand updates. In crypto, sentiment remains fragile as policy-rate expectations adjust and liquidity thins.
Risks skew around policy execution and confidence: a surprise on inflation expectations, an abrupt change in Fed signaling, or a sharper downdraft in high-multiple tech could pressure indexes. Conversely, confirmation of easier policy and resilient consumer spending could extend the bid in cyclicals, financials, and defensives.
Bottom line: Into the Thanksgiving break, the market tone is measured but constructive outside mega-cap tech. A modest duration bid, firmer euro, steady gold, and softer energy set the stage. The December Fed decision, potential Fed leadership news, and evolving AI supply chains are the primary catalysts likely to dictate whether this early rotation broadens or reverses in the sessions ahead.
Markets opened with a split tone on Tuesday as investors balance monetary-policy expectations, leadership chatter at the Federal Reserve, and shifting currents within the AI and energy trades. The Dow proxy (DIA) and small caps (IWM) are firmer out of the gate while the tech-heavy QQQ lags, reflecting a modest rotation back toward cyclicals, financials, and healthcare amid a mild bid for duration in bonds.
At 9:30 a.m. ET, SPY is essentially flat to slightly lower versus Monday’s close, trading fractionally below its prior mark. QQQ is off about a quarter of a percent from yesterday’s finish, while DIA is up roughly four-tenths of a percent. IWM is also higher by a similar magnitude, hinting at some early breadth beyond the mega-cap complex.
Macro backdrop: yields, inflation, and expectations
Treasury yields remain broadly anchored to softer, with the 10-year at 4.06% and the 2-year near 3.51% as of the latest available readings. The curve is modestly positively sloped from 2s to 10s and rises further to the long bond at 4.71%, suggesting term premia and longer-run inflation/rate risks remain embedded even as front-end expectations ease. Five-year and one-year tenors both sit at 3.62%, below the 10-year, reinforcing a narrative of a gentler policy path relative to earlier in the year.
The latest CPI prints in the dataset are for September (headline index 324.368; core 330.542). While year-over-year changes are not provided, breakeven and model-based measures of inflation expectations help fill in the picture: market-based 5-year and 10-year expectations are 2.36% and 2.31%, respectively, with the 5y5y forward at 2.25%. A model-based 1-year expectation sits near 2.74%, consistent with a view that near-term disinflation may continue, but not linearly.
Policy remains at the forefront. MarketWatch highlights that investors are watching “critical clues” on job openings, wages and labor-market perceptions as Fed hawks and doves debate the trajectory into year-end. Separate coverage argues that a December rate cut, once doubtful, now appears more likely given the evolution of data and Fed rhetoric, and Bloomberg notes gold steadied as New York Fed President Williams signaled a near-term cut. Meanwhile, U.S. Treasury Secretary Scott Bessent told CNBC over the weekend that he does not see a 2026 recession, and this morning CNBC reports Bessent sees a “very good chance” President Trump names a new Fed chair before Christmas—another potential driver of rates volatility into year-end as the market handicaps continuity versus change.
Equities: index-level picture and sector rotation
The index complexion reflects these cross-currents. SPY is fractionally lower versus Monday’s 668.73 close, QQQ is down about 0.24%, while DIA is up around 0.37% and IWM higher roughly 0.39%. The pattern fits a modest factor rotation away from AI-levered mega-cap growth toward cyclicals and domestically sensitive segments, a theme echoed in recent reporting that “stocks are trading on a knife’s edge” ahead of December’s Fed decision.
Within sectors, early prints show:
- XLK (technology) easing about 0.9% versus Monday’s close. Recent articles highlight an AI trade reset as Alphabet’s custom-chip efforts draw interest—including a potential Meta data-center tie-up—raising the prospect of more formidable competition for third-party accelerators. MarketWatch notes Alphabet’s stock has been rising on this theme, while Nvidia and AMD shares have faced pressure on the idea of a more diversified AI silicon landscape. That narrative is showing up in the sector tape today.
- XLF (financials) up roughly 0.4%. A softening in longer-dated yields can be a two-edged sword for net interest margins, but steadier rates and improving risk sentiment often support financials into year-end. The small-cap bid also tends to correlate with regional-bank appetite.
- XLV (health care) up about 0.4%. Stock-specific news is mixed in the space: MarketWatch flags a positive trial result for a Novo Nordisk weight-loss candidate even as a separate oral GLP-1 failed to show benefit in Alzheimer’s, producing a push-pull across obesity and neurology narratives.
- XLE (energy) slightly higher at the open despite weakness in crude-linked products, suggesting stock-level and dividend support may be offsetting commodity headwinds.
Beyond the sector aggregates, company news remains active. MarketWatch reports Alibaba’s revenue topped expectations with the company emphasizing its AI capabilities; the stock “spiked 5%” Tuesday morning. Multiple pieces underscore shifting leadership within AI: Jim Cramer suggests Alphabet’s Gemini poses a serious challenge to OpenAI, and additional coverage frames Google’s AI momentum as a potential overhang for parts of the semiconductor complex. Another MarketWatch piece queries whether the “Magnificent Seven” era is ending, with a renewed focus on idiosyncratic drivers for Nvidia, Microsoft, and Apple. On the consumer side, CNBC notes Kohl’s named Michael Bender as permanent CEO after a turbulent year, and MarketWatch cites Burlington’s sales miss due in part to warm weather impacting traffic. Tesla remains in the headlines after reports of a three-year sales low in China, even as Elon Musk touted progress on in-house AI chips.
Bonds: bid to duration as policy odds shift
Treasuries are modestly bid and the ETF proxies are reflecting that. TLT is up roughly 0.3% versus Monday, IEF is up about 0.1%, and SHY is essentially flat. The 10-year yield anchored near 4.06% against a softer front end is consistent with the “December cut more likely” narrative highlighted by MarketWatch and with Bloomberg’s note on dovish signaling from Williams. The curve’s positive slope from 2s to 10s to 30s suggests longer-run uncertainty remains, but the near-term rates impulse is easing, a dynamic that typically supports rate-sensitive equities and precious metals while tempering the U.S. dollar.
Commodities: precious metals steady, crude and gas slide
Gold (GLD) is fractionally higher versus Monday, building on the stabilizing impulse described by Bloomberg in the context of a potential near-term Fed cut. Silver (SLV) is a touch lower, continuing a recent pattern of relative underperformance to gold during policy transitions. Oil is pressured: USO is down a little more than 2% relative to yesterday, dovetailing with Bloomberg’s latest oil round-up noting last week’s sharp losses and ongoing concerns about ample supply. Natural gas weakness is more acute at the open, with UNG off about 5%, reflecting seasonal and storage dynamics and, potentially, weather-related demand skepticism. Broad commodities (DBC) were last unchanged versus Monday’s close, though live quotes indicate a softer bias consistent with the energy complex.
FX and crypto: euro firmer, crypto softer
EURUSD is modestly firmer versus its stated open, consistent with the combination of a bid to Treasuries and the market’s leaning toward easier Fed policy. In crypto, Bitcoin (BTCUSD) trades around $87,100, down about 1.4% from its provided open level, and ether (ETHUSD) is off roughly 0.9%. MarketWatch’s recent coverage framed bitcoin’s pullback from October highs as an emerging barometer for broader risk sentiment; Deutsche Bank’s “Tinkerbell effect” note underscores how shifts in collective belief can exacerbate crypto volatility. The day’s macro tone—softer yields, tech wobbles, and commodity softness—is consistent with the mixed-to-cautious setup for high-beta assets.
Notable corporate and thematic movers from the news flow
- Fed and policy: CNBC reports that Secretary Bessent sees a strong chance of a new Fed chair nomination before Christmas, injecting a fresh source of policy uncertainty into an already consequential December. MarketWatch surveys the stakes ahead of the meeting, while another piece argues a cut is increasingly likely. These factors appear to be supporting duration and precious metals early.
- AI platform realignment: MarketWatch highlights Alphabet’s potential chip collaboration with Meta for data centers, with knock-on pressure for Nvidia and AMD as investors contemplate a more fragmented accelerator landscape. Cramer separately calls out Gemini’s threat to ChatGPT. These developments map to the early underperformance in XLK.
- China and U.S. growth levers: Alibaba’s better-than-expected revenue, tied to AI momentum, provides a counterpoint to Tesla’s softer China sales narrative. The mixed picture helps explain the crosscurrents between QQQ and the broader indices.
- Energy supply: Bloomberg’s oil recap points to a market reassessing supply scenarios and geopolitical risk premia; that context aligns with the downdraft in USO and UNG at the open.
- Consumer and retail: MarketWatch and CNBC pieces ahead of the holiday shopping stretch focus on promotions and value positioning, with Burlington’s miss and Kohl’s leadership change illustrating the operational dispersion within retail. Lower inflation-adjusted gasoline costs into Thanksgiving, per MarketWatch, may help sentiment, though food inflation remains a pressure point for households.
Outlook and what to watch
With a shortened holiday week, liquidity can exaggerate moves, but the macro signposts are clear: watch labor demand gauges, wage growth, and consumer conditions as investors calibrate the odds of a December rate cut. Any developments around Fed leadership, as flagged by CNBC’s Bessent coverage, could spark curve and risk-asset volatility. Within equities, leadership is fluid: AI infrastructure competition and in-house silicon roadmaps are reshaping expectations for margins and capex cycles across cloud, semis, and platform companies. Energy’s softness bears monitoring into the next set of supply-demand updates. In crypto, sentiment remains fragile as policy-rate expectations adjust and liquidity thins.
Risks skew around policy execution and confidence: a surprise on inflation expectations, an abrupt change in Fed signaling, or a sharper downdraft in high-multiple tech could pressure indexes. Conversely, confirmation of easier policy and resilient consumer spending could extend the bid in cyclicals, financials, and defensives.
Bottom line: Into the Thanksgiving break, the market tone is measured but constructive outside mega-cap tech. A modest duration bid, firmer euro, steady gold, and softer energy set the stage. The December Fed decision, potential Fed leadership news, and evolving AI supply chains are the primary catalysts likely to dictate whether this early rotation broadens or reverses in the sessions ahead.