State of Market: Midday 12/26/25
Midday market check: Stocks mixed as metals surge, long yields steady; ‘Santa Claus’ seasonality meets year-end positioning
SPY and DIA edge lower while QQQ is flat-to-up; silver extends a powerful run and gold grinds higher; oil eases even as geopolitical risks simmer; crypto drifts lower intraday; yield curve remains positively sloped from 2s to 30s.
TendieTensor.com State of Market Midday
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Overview
U.S. equities are mixed at midday on the first full session after the holiday, as year-end seasonality, thin liquidity, and tax-related flows intersect. The S&P 500 proxy SPY is modestly lower, while the tech-heavy QQQ is fractionally higher and the Dow tracker DIA and small-cap IWM lag. Under the surface, technology is firmer, financials and health care are a touch softer, and commodities are diverging: precious metals extend their pre-holiday strength while oil slips. Treasury yields remain anchored in a positively sloped curve from 2 to 30 years, and crypto is softer on the day.
Seasonal narratives are in focus. Multiple reports highlight that the so-called Santa Claus rally is off to a constructive start and that Dec. 26 has historically been a favorable session for the S&P 500. Stocks also recently notched fresh records into Christmas week, and implied volatility is subdued heading into the final trading days of the year—conditions that often coincide with orderly tape action but can be vulnerable to sharp moves if liquidity thins further.
Macro backdrop: Yields, inflation and expectations
Treasury yields, last reported on December 22, show a curve with the 2-year at 3.44%, 5-year at 3.71%, 10-year at 4.17% and 30-year at 4.84%. The positive slope from 2s to 10s and out to 30s suggests markets continue to price a more normal term premium at the long end, even as front-end yields sit below long rates. For equities, a 10-year near 4.17% remains a key reference point: not overly restrictive relative to levels seen earlier this year, but high enough that duration-sensitive segments can react to incremental changes.
Inflation’s latest read (November) shows the CPI index at 325.031 and core CPI at 331.068. While those are index levels rather than growth rates, they pair with inflation expectations that are broadly consistent with a glide path toward the Federal Reserve’s longer-run goals. Model-based expectations for December point to 1-year at 3.20%, 5-year at 2.42% and 10-year at 2.34%. The downward step from near-term to longer horizons echoes market confidence that inflation pressures continue to moderate over time. That backdrop supports the case for continued multiple stability in equities and a less volatile rates complex—conditions reflected in this month’s quieter bond-market volatility and equities’ constructive tone noted in recent coverage.
Equities: Mixed tape at midday
- SPY last trades near 689.67 versus a previous close of 690.38, down roughly 0.1% at 1:30 p.m. ET. That small dip keeps the broader market essentially flat as investors parse the final week’s seasonal tailwinds against year-end rebalancing.
- QQQ prints 623.99 versus 623.93 previously, fractionally higher and consistent with ongoing leadership from large-cap technology.
- DIA is at 486.01 versus 487.01, down about 0.2%, reflecting some softness in Dow constituents relative to mega-cap tech.
- IWM changes hands at 251.07 versus 252.71 prior, off approximately 0.6%, as small caps lag into the session.
A series of articles emphasizes the seasonal setup: after two straight misses, the “Santa Claus rally” is off to a solid start and history suggests a favorable bias across the final trading days and first two sessions of the new year. Recent reports also note the S&P 500 hitting record territory into Christmas week and a subdued VIX signaling investor calm. The midday constancy in SPY and QQQ aligns with that tenor: moderate moves and no broad risk-off impulse.
Sector trends: Tech firm, defensives mixed, financials slightly softer
- XLK at 146.705 versus 146.30 is up about 0.3%, leading the sector stack midday. Thematically, continued AI and data center investment stories remain a tailwind for sentiment, with reports on Nvidia’s strategic moves—including a licensing deal with AI-chip startup Groq—and 2026 product and ecosystem expectations underscoring ongoing secular demand narratives.
- XLF at 55.48 versus 55.73 is down around 0.5%. With the curve positively sloped from 2s to 10s, financials’ net interest margin dynamics are not flashing acute stress, but year-end repositioning and modest equity softness weigh intraday.
- XLV at 155.47 versus 155.80 is slightly lower (about 0.2%). Health care’s defensive profile has been mixed into year-end, as investors balance earnings visibility with policy and pricing headlines. Outside the sector ETFs, Novo Nordisk-related headlines point to obesity drug developments, though we do not have midday quotes for that stock.
We do not have a clean energy-sector ETF read in today’s payload (the sector listing shows a symbol mismatch), but the oil proxy (USO) and broader commodity basket (DBC) provide useful context for cyclical risk sentiment and input costs.
Bonds: Long duration down, belly/front steady
- TLT trades near 87.655 versus 88.03 previously, down about 0.4%, consistent with a long-end yield anchored around 4.84% for the 30-year in the latest available figures.
- IEF at 96.375 versus 96.35 is flat to slightly higher, and SHY at 82.785 versus 82.73 is up a touch. The small gains in the front end and belly align with a curve that remains upward sloping to the long bond. With inflation expectations anchored near 2.3%–2.4% in the 5- to 10-year window, the rates market is signaling stability absent new macro catalysts.
Commodities: Precious metals extend strength; energy mixed
- GLD at 415.55 versus 411.93 is up roughly 0.9% midday, while SLV at 69.655 versus 65.22 is up about 6.8%, continuing a powerful pre-holiday run. Recent coverage highlights fresh highs for gold and silver and flags both bullish enthusiasm and caution: some strategists describe the surge as “unhinged,” and one silver-focused voice speaks to the potential for a “mania phase.” The price action today corroborates that momentum remains with the bulls into year-end.
- USO at 68.80 versus 70.20 is down about 2.0%, suggesting crude softness despite ongoing geopolitical risk. News of Ukrainian drones striking a large Russian gas processing facility underscores latent energy supply risks, but today’s tape reflects a pullback following recent firmness. Broader commodities (DBC at 22.685 vs. 22.63) are modestly higher.
- UNG at 12.745 versus 12.39 is up nearly 2.9%, showing bid support in U.S. natural gas proxies.
FX and crypto: Euro range-bound; crypto softer intraday
- EURUSD marks near 1.177, with an intraday range around 1.176–1.179. That’s a slight dip from the session open, but within a tight band midday. The U.S. dollar’s broader setup has drawn technical commentary around a potential “golden cross,” suggesting scope for stabilization into early 2026; today’s EURUSD drift fits that narrative of consolidation rather than trend.
- Bitcoin (BTCUSD) marks around 87,152 versus an open near 88,901, down roughly 2% intraday, with a range between about 86,522 and 89,525. Ether (ETHUSD) marks near 2,919 versus an open around 2,969, down roughly 1.7% intraday. The softer tone aligns with recent reflections that, despite policy and product milestones in 2025, crypto prices struggled and investors are looking to 2026 for further clarity and potential support.
Notable company and thematic headlines
- Seasonality and sentiment: Coverage notes the Santa Claus rally is on firmer footing after two misses, and that Dec. 26 has historically skewed positive. The S&P 500’s recent record close and a subdued VIX highlight constructive year-end risk appetite.
- AI and semiconductors: Reports detail Nvidia’s non-exclusive licensing arrangement with Groq and broader expectations for Nvidia’s 2026 trajectory, including the competitive landscape tied to new AI models and data center buildouts. Strategists also point to semiconductor sector charts that may be consolidating ahead of another potential leg higher. These stories are consistent with XLK’s midday leadership.
- Cybersecurity for AI: ServiceNow’s agreement to acquire Armis is another marker of enterprise spend migrating toward securing AI-era infrastructure—supportive for the broader software and cybersecurity complex even if we lack real-time quotes for the names mentioned.
- Retail and consumer: Target reportedly received a lift on headlines of a significant investment by Toms Capital, while Nike-related insider buying drew attention after a prolonged slide. We do not have live prices for those stocks in today’s data, but the narratives feed into year-end stock-specific positioning.
- Energy and geopolitics: News of drones hitting a major Russian gas facility keeps a floor under energy risk premia, though oil is down on the session via USO. The mix of geopolitical risk and soft midday price action speaks to competing forces: supply headlines versus year-end flows and macro growth expectations.
- Precious metals: Multiple pieces highlight record-setting momentum and bullish calls into 2026, balanced by warnings on overheated conditions and tax-driven selling risks around the calendar year-end. Today’s strong advances in GLD and SLV show momentum still in charge, but investors should be mindful of potential profit-taking as deadlines approach.
What to watch next
- Seasonal follow-through: The Santa Claus window typically includes the final five trading days of the year and the first two of January. Watch whether SPY and QQQ can hold or build on this week’s gains amid light volumes.
- Yields versus growth: With the 10-year at 4.17% and long bond near 4.84% in the latest data, keep an eye on any re-pricing in the long end that could pressure TLT further or, conversely, a bid for duration that bolsters long bond proxies.
- Metals momentum vs. tax calendar: Silver’s outsized move and gold’s steady climb could invite late-year profit-taking. Upcoming sessions may show increased two-way flows as investors manage gains and losses.
- Oil and gas: The geopolitical tape remains event-driven. If energy headlines escalate, watch USO and UNG for spillover into inflation expectations and cyclicals.
- Tech leadership durability: With XLK edging higher and AI-related headlines ongoing, leadership concentration remains in focus. Any broadening of participation—particularly from small caps (IWM)—would be a healthy sign for market breadth.
Risks
- Liquidity and year-end mechanics: Thin holiday trading can amplify moves. Rebalancing and tax-related selling could create abrupt, non-fundamental swings.
- Policy and regulation: Reports of fresh scrutiny for certain auto technologies remind investors that regulatory risk can surface quickly, affecting sentiment beyond the impacted names.
- Geopolitics: Energy infrastructure incidents and broader regional tensions can reprice oil and gas, influencing inflation expectations and central-bank reaction functions.
- Macro surprise risk: While expectations are anchored, any unexpected data on growth or prices could reawaken rates volatility and challenge equity multiples.
- Valuation and positioning: After record prints and buoyant sentiment, the bar for positive surprises is higher. A complacent volatility backdrop can be vulnerable to shocks.
Overall, midday markets are calm and orderly: SPY and DIA are modestly lower, QQQ is flat-to-up, and IWM trails. The yield curve’s positive slope, anchored inflation expectations, and low volatility support a constructive bias, while precious metals’ surge and oil’s softness show that commodity-specific dynamics remain in play. The final days of the year will likely be governed by seasonal flows and headlines, with the bigger debates—AI investment cycles, growth sustainability, and policy direction—carrying into early 2026.
Overview
U.S. equities are mixed at midday on the first full session after the holiday, as year-end seasonality, thin liquidity, and tax-related flows intersect. The S&P 500 proxy SPY is modestly lower, while the tech-heavy QQQ is fractionally higher and the Dow tracker DIA and small-cap IWM lag. Under the surface, technology is firmer, financials and health care are a touch softer, and commodities are diverging: precious metals extend their pre-holiday strength while oil slips. Treasury yields remain anchored in a positively sloped curve from 2 to 30 years, and crypto is softer on the day.
Seasonal narratives are in focus. Multiple reports highlight that the so-called Santa Claus rally is off to a constructive start and that Dec. 26 has historically been a favorable session for the S&P 500. Stocks also recently notched fresh records into Christmas week, and implied volatility is subdued heading into the final trading days of the year—conditions that often coincide with orderly tape action but can be vulnerable to sharp moves if liquidity thins further.
Macro backdrop: Yields, inflation and expectations
Treasury yields, last reported on December 22, show a curve with the 2-year at 3.44%, 5-year at 3.71%, 10-year at 4.17% and 30-year at 4.84%. The positive slope from 2s to 10s and out to 30s suggests markets continue to price a more normal term premium at the long end, even as front-end yields sit below long rates. For equities, a 10-year near 4.17% remains a key reference point: not overly restrictive relative to levels seen earlier this year, but high enough that duration-sensitive segments can react to incremental changes.
Inflation’s latest read (November) shows the CPI index at 325.031 and core CPI at 331.068. While those are index levels rather than growth rates, they pair with inflation expectations that are broadly consistent with a glide path toward the Federal Reserve’s longer-run goals. Model-based expectations for December point to 1-year at 3.20%, 5-year at 2.42% and 10-year at 2.34%. The downward step from near-term to longer horizons echoes market confidence that inflation pressures continue to moderate over time. That backdrop supports the case for continued multiple stability in equities and a less volatile rates complex—conditions reflected in this month’s quieter bond-market volatility and equities’ constructive tone noted in recent coverage.
Equities: Mixed tape at midday
- SPY last trades near 689.67 versus a previous close of 690.38, down roughly 0.1% at 1:30 p.m. ET. That small dip keeps the broader market essentially flat as investors parse the final week’s seasonal tailwinds against year-end rebalancing.
- QQQ prints 623.99 versus 623.93 previously, fractionally higher and consistent with ongoing leadership from large-cap technology.
- DIA is at 486.01 versus 487.01, down about 0.2%, reflecting some softness in Dow constituents relative to mega-cap tech.
- IWM changes hands at 251.07 versus 252.71 prior, off approximately 0.6%, as small caps lag into the session.
A series of articles emphasizes the seasonal setup: after two straight misses, the “Santa Claus rally” is off to a solid start and history suggests a favorable bias across the final trading days and first two sessions of the new year. Recent reports also note the S&P 500 hitting record territory into Christmas week and a subdued VIX signaling investor calm. The midday constancy in SPY and QQQ aligns with that tenor: moderate moves and no broad risk-off impulse.
Sector trends: Tech firm, defensives mixed, financials slightly softer
- XLK at 146.705 versus 146.30 is up about 0.3%, leading the sector stack midday. Thematically, continued AI and data center investment stories remain a tailwind for sentiment, with reports on Nvidia’s strategic moves—including a licensing deal with AI-chip startup Groq—and 2026 product and ecosystem expectations underscoring ongoing secular demand narratives.
- XLF at 55.48 versus 55.73 is down around 0.5%. With the curve positively sloped from 2s to 10s, financials’ net interest margin dynamics are not flashing acute stress, but year-end repositioning and modest equity softness weigh intraday.
- XLV at 155.47 versus 155.80 is slightly lower (about 0.2%). Health care’s defensive profile has been mixed into year-end, as investors balance earnings visibility with policy and pricing headlines. Outside the sector ETFs, Novo Nordisk-related headlines point to obesity drug developments, though we do not have midday quotes for that stock.
We do not have a clean energy-sector ETF read in today’s payload (the sector listing shows a symbol mismatch), but the oil proxy (USO) and broader commodity basket (DBC) provide useful context for cyclical risk sentiment and input costs.
Bonds: Long duration down, belly/front steady
- TLT trades near 87.655 versus 88.03 previously, down about 0.4%, consistent with a long-end yield anchored around 4.84% for the 30-year in the latest available figures.
- IEF at 96.375 versus 96.35 is flat to slightly higher, and SHY at 82.785 versus 82.73 is up a touch. The small gains in the front end and belly align with a curve that remains upward sloping to the long bond. With inflation expectations anchored near 2.3%–2.4% in the 5- to 10-year window, the rates market is signaling stability absent new macro catalysts.
Commodities: Precious metals extend strength; energy mixed
- GLD at 415.55 versus 411.93 is up roughly 0.9% midday, while SLV at 69.655 versus 65.22 is up about 6.8%, continuing a powerful pre-holiday run. Recent coverage highlights fresh highs for gold and silver and flags both bullish enthusiasm and caution: some strategists describe the surge as “unhinged,” and one silver-focused voice speaks to the potential for a “mania phase.” The price action today corroborates that momentum remains with the bulls into year-end.
- USO at 68.80 versus 70.20 is down about 2.0%, suggesting crude softness despite ongoing geopolitical risk. News of Ukrainian drones striking a large Russian gas processing facility underscores latent energy supply risks, but today’s tape reflects a pullback following recent firmness. Broader commodities (DBC at 22.685 vs. 22.63) are modestly higher.
- UNG at 12.745 versus 12.39 is up nearly 2.9%, showing bid support in U.S. natural gas proxies.
FX and crypto: Euro range-bound; crypto softer intraday
- EURUSD marks near 1.177, with an intraday range around 1.176–1.179. That’s a slight dip from the session open, but within a tight band midday. The U.S. dollar’s broader setup has drawn technical commentary around a potential “golden cross,” suggesting scope for stabilization into early 2026; today’s EURUSD drift fits that narrative of consolidation rather than trend.
- Bitcoin (BTCUSD) marks around 87,152 versus an open near 88,901, down roughly 2% intraday, with a range between about 86,522 and 89,525. Ether (ETHUSD) marks near 2,919 versus an open around 2,969, down roughly 1.7% intraday. The softer tone aligns with recent reflections that, despite policy and product milestones in 2025, crypto prices struggled and investors are looking to 2026 for further clarity and potential support.
Notable company and thematic headlines
- Seasonality and sentiment: Coverage notes the Santa Claus rally is on firmer footing after two misses, and that Dec. 26 has historically skewed positive. The S&P 500’s recent record close and a subdued VIX highlight constructive year-end risk appetite.
- AI and semiconductors: Reports detail Nvidia’s non-exclusive licensing arrangement with Groq and broader expectations for Nvidia’s 2026 trajectory, including the competitive landscape tied to new AI models and data center buildouts. Strategists also point to semiconductor sector charts that may be consolidating ahead of another potential leg higher. These stories are consistent with XLK’s midday leadership.
- Cybersecurity for AI: ServiceNow’s agreement to acquire Armis is another marker of enterprise spend migrating toward securing AI-era infrastructure—supportive for the broader software and cybersecurity complex even if we lack real-time quotes for the names mentioned.
- Retail and consumer: Target reportedly received a lift on headlines of a significant investment by Toms Capital, while Nike-related insider buying drew attention after a prolonged slide. We do not have live prices for those stocks in today’s data, but the narratives feed into year-end stock-specific positioning.
- Energy and geopolitics: News of drones hitting a major Russian gas facility keeps a floor under energy risk premia, though oil is down on the session via USO. The mix of geopolitical risk and soft midday price action speaks to competing forces: supply headlines versus year-end flows and macro growth expectations.
- Precious metals: Multiple pieces highlight record-setting momentum and bullish calls into 2026, balanced by warnings on overheated conditions and tax-driven selling risks around the calendar year-end. Today’s strong advances in GLD and SLV show momentum still in charge, but investors should be mindful of potential profit-taking as deadlines approach.
What to watch next
- Seasonal follow-through: The Santa Claus window typically includes the final five trading days of the year and the first two of January. Watch whether SPY and QQQ can hold or build on this week’s gains amid light volumes.
- Yields versus growth: With the 10-year at 4.17% and long bond near 4.84% in the latest data, keep an eye on any re-pricing in the long end that could pressure TLT further or, conversely, a bid for duration that bolsters long bond proxies.
- Metals momentum vs. tax calendar: Silver’s outsized move and gold’s steady climb could invite late-year profit-taking. Upcoming sessions may show increased two-way flows as investors manage gains and losses.
- Oil and gas: The geopolitical tape remains event-driven. If energy headlines escalate, watch USO and UNG for spillover into inflation expectations and cyclicals.
- Tech leadership durability: With XLK edging higher and AI-related headlines ongoing, leadership concentration remains in focus. Any broadening of participation—particularly from small caps (IWM)—would be a healthy sign for market breadth.
Risks
- Liquidity and year-end mechanics: Thin holiday trading can amplify moves. Rebalancing and tax-related selling could create abrupt, non-fundamental swings.
- Policy and regulation: Reports of fresh scrutiny for certain auto technologies remind investors that regulatory risk can surface quickly, affecting sentiment beyond the impacted names.
- Geopolitics: Energy infrastructure incidents and broader regional tensions can reprice oil and gas, influencing inflation expectations and central-bank reaction functions.
- Macro surprise risk: While expectations are anchored, any unexpected data on growth or prices could reawaken rates volatility and challenge equity multiples.
- Valuation and positioning: After record prints and buoyant sentiment, the bar for positive surprises is higher. A complacent volatility backdrop can be vulnerable to shocks.
Overall, midday markets are calm and orderly: SPY and DIA are modestly lower, QQQ is flat-to-up, and IWM trails. The yield curve’s positive slope, anchored inflation expectations, and low volatility support a constructive bias, while precious metals’ surge and oil’s softness show that commodity-specific dynamics remain in play. The final days of the year will likely be governed by seasonal flows and headlines, with the bigger debates—AI investment cycles, growth sustainability, and policy direction—carrying into early 2026.