Global Markets Weekly Update
Date: January 02, 2026
U.S. Market Overview
U.S. stocks experienced a decline during the holiday-shortened week, with most indexes closing out 2025 on a positive note, having achieved double-digit gains for the third consecutive year. The Nasdaq Composite saw the largest drop, while the Dow Jones Industrial Average and S&P MidCap 400 Index performed relatively better, losing 0.67% and 0.71%, respectively. The energy sector was a standout performer, benefiting from rising oil prices due to geopolitical tensions.
Housing Market Insights
The National Association of Realtors reported a 3.3% increase in the Pending Home Sales Index for November, the largest monthly increase since February 2023. This surge is attributed to lower mortgage rates and rising wages, which are improving housing affordability.
Federal Reserve Updates
Minutes from the Federal Reserve's December meeting revealed divisions among policymakers regarding future rate cuts. While most officials support further cuts if inflation decreases, some advocate for maintaining the current rate for an extended period. The probability of a January rate cut remains low at around 15%.
Labor Market Trends
Jobless claims fell for the third consecutive week, with applications totaling 199,000, indicating a strengthening labor market.
European Market Highlights
The pan-European STOXX Europe 600 Index reached a new high, closing 1.26% higher, supported by a favorable economic environment. Inflation in Spain eased, while France saw a decrease in registered unemployment. However, UK house prices unexpectedly declined.
Asian Market Developments
Japan's stock markets saw a slight decline, with the Nikkei 225 Index down 0.8%. The yield on the 10-year Japanese government bond rose to its highest level since 1999, reflecting expectations of continued interest rate increases by the Bank of Japan.
Chinese Market Performance
Mainland Chinese stock markets ended the week mixed, with a slight decline in the CSI 300 Index. However, a rise in the manufacturing purchasing managers' index suggests a potential recovery in the sector.
Other Key Markets
In Colombia, a significant minimum wage increase could lead to higher inflation, while South Korea's stock market started the new year strong, buoyed by record export figures.
Disclaimer: This material is for informational purposes only and is not intended as investment advice. Past performance is not indicative of future results.