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, achieving 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.
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 growth is attributed to lower mortgage rates and rising wages, improving housing affordability.
Additionally, U.S. house prices rose by 0.4% month-over-month in October, with a year-over-year increase of 1.7%.
Federal Reserve Updates
The Federal Reserve's minutes from the December meeting indicated a division among policymakers regarding future rate cuts, with some advocating for a pause in rate adjustments. 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.
Bond Market Performance
U.S. Treasury yields were mixed, with high yield bonds outperforming in a week of light trading volumes.
Market Index Performance
| Index | Friday's Close | Week's Change | % Change YTD |
|---|---|---|---|
| DJIA | 48,382.39 | -328.58 | 0.66% |
| S&P 500 | 6,858.47 | -71.47 | 0.19% |
| Nasdaq Composite | 23,235.63 | -357.47 | -0.03% |
| S&P MidCap 400 | 3,349.39 | -23.90 | 1.34% |
| Russell 2000 | 2,508.22 | -26.12 | 1.06% |
International Market Highlights
Europe
The STOXX Europe 600 Index reached a new high, closing 1.26% higher, supported by a favorable economic environment. Inflation in Spain eased, while unemployment in France decreased.
Japan
Japanese markets saw a decline, with the Nikkei 225 Index down 0.8%. The yield on 10-year Japanese government bonds rose to its highest level since 1999.
China
Chinese stock markets had mixed results, with a slight decline in the CSI 300 Index but an increase in the Shanghai Composite Index. Manufacturing data showed a modest improvement.
Other Key Markets
Colombia's assets faced pressure due to a significant minimum wage increase, while South Korea's stock market started the year strong, buoyed by record export data.