The stock market rallied near the close with major indices like the S&P 500 and Nasdaq 100 posting gains, led by strong performances in technology and AI-related sectors, while individual stocks such as Carnival and Oracle saw notable increases. However, some companies like Nike, Lamb Weston, and KB Home faced significant declines amid mixed earnings and cautious outlooks, as investors also monitored bond yields, upcoming Federal Reserve meetings, and potential political developments.
As the trading day nears its close, the stock market is showing a rally with major indices like the S&P 500 and Nasdaq 100 posting gains. The S&P 500 is up nearly 0.9%, erasing losses from earlier in the week and positioning for a slight weekly gain. The Dow Jones is also up on the day but is expected to finish the week in the red. Sector-wise, technology leads the gains with over 2% increase, supported by financials, industrials, and healthcare, while consumer discretionary, utilities, consumer staples, and real estate lag behind.
Among individual stocks, Carnival stands out as the top gainer, surging nearly 10% after raising its profit outlook for next year and reinstating dividend payments. Oracle also gained nearly 7% following news of a joint venture to buy TikTok’s U.S. operations, which will be managed by a majority American board. A smaller company, White Fiber, announced a significant 10-year data center agreement aimed at supporting AI and machine learning infrastructure, although its stock has declined since its IPO.
On the downside, Nike shares dropped over 10% after warning of declining sales this quarter, citing persistent weakness in China and poor performance of its Converse brand. Lamb Weston, a frozen foods company, fell 26% despite beating earnings expectations, due to concerns over price mix declines and rising manufacturing costs. Homebuilder KB Home also saw a sharp decline of 8.5% after missing profit estimates and providing a cautious outlook for fiscal 2026 housing revenue.
In the bond market, yields have shifted higher on the day but remain lower on the week, with the two-year yield dropping for two consecutive weeks amid expectations of continued Federal Reserve rate cuts in 2026. Market participants are closely watching inflows into U.S. stocks, which have rebounded after a period of uncertainty, though U.S. market performance has been outpaced by some international markets, including Europe and emerging markets like Venezuela, which saw extraordinary gains this year.
Looking ahead, key events to watch include the next Federal Reserve meeting scheduled for January 28, 2026, and JPMorgan’s earnings report on January 13. Political developments, such as the potential for a government shutdown, also remain on investors’ radar. As the year winds down with the holiday season approaching, market watchers remain focused on how these factors will shape the financial landscape in the coming year.