State of Market: Midday 12/17/25
Stocks slip at midday as tech lags; precious metals and energy catch a bid while crypto softens
Oracle-linked AI capex worries weigh on growth proxies; gold and silver advance on stable inflation expectations and firming commodities; investors eye Thursday’s delayed CPI and ongoing Fed-speak
TendieTensor.com State of Market Midday
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Markets are lower at midday Wednesday in New York, with megacap tech and software weakness dragging on the broader tape while commodities, notably precious metals and crude-linked instruments, firm. The backdrop features subdued Treasury prices, anchored inflation expectations, and a heavy slate of policy and corporate headlines that are shaping sector performance ahead of a delayed CPI release due Thursday.
Equities and sectors
- S&P 500 proxy SPY is trading at 673.27, below Tuesday’s 678.87 close, reflecting broad softness across large caps.
- Nasdaq-100 proxy QQQ is at 603.34 versus a prior close of 611.75, underperforming as investor attention remains fixed on AI spending trajectories and software demand.
- The Dow Jones Industrial Average ETF DIA prints 480.40, modestly below 481.98 on Tuesday, while small-cap proxy IWM is at 248.18 versus 249.90 previously, indicating a mild risk-off tone across size segments.
Within sectors, the price action is consistent with a growth-led pullback:
- Technology (XLK) is at 140.14, below its 142.56 prior close, with multiple headlines reinforcing caution around AI-related capital expenditure and software strategy. Oracle is a focal point after renewed worries about data-center financing and AI spending (MarketWatch), and a separate analysis outlines how those financing questions have extended to the company’s bonds as well (MarketWatch). Combined with commentary about potential shifts in AI leadership trades and high-profile chip stock volatility, the tech complex is consolidating gains into year-end.
- Financials (XLF) trade at 54.64, essentially flat to slightly below Tuesday’s 54.64, while Health Care (XLV) at 153.99 sits just under its 154.07 prior close. The day’s marquee new listing is in health care: Medline debuted after 2025’s largest IPO, priced at $29 and raising $6.26 billion (CNBC), providing a test of late-year risk appetite in the primary market.
- Utilities (XLU) are softer at 42.57 compared with 43.04, consistent with a modest drift higher in longer-term yields earlier in the week and a rotation into cyclicals tied to commodities.
Macro backdrop: rates, inflation, expectations
The latest available Treasury curve levels from Monday, December 15, show the 2-year at 3.51%, 5-year 3.73%, 10-year 4.18%, and 30-year 4.84%. That curve configuration keeps term premiums in focus but conveys no acute stress, aligning with a modest dip in long-duration bond ETFs midday (see Bonds below). On inflation, the most recent index levels show CPI at 324.368 and core CPI at 330.542 (September reading). While those are index levels rather than rates of change, market-based inflation expectations remain contained: 5-year breakevens sit near 2.35%, the 10-year at 2.27%, and the 5y5y forward at 2.18% (November).
Policy communications are front and center. A MarketWatch interview notes that Fed chair finalist Christopher Waller sees inflation starting to decline over the next three to four months and room for a moderate pace of rate cuts, roughly 100 basis points. Separately, CNBC reports Waller emphasized he would “absolutely” stress Federal Reserve independence. At the same time, Atlanta Fed President Raphael Bostic signaled concern that fiscal proposals could complicate the inflation outlook, arguing for no rate cuts in 2026 (MarketWatch). The mixed but generally disinflation-consistent messaging aligns with anchored expectations, but with enough policy variance to keep duration positioning tactical.
Thursday’s delayed CPI release looms large. MarketWatch highlights that inflation was rising before the government shutdown that delayed the data; the overdue report will help clarify whether recent price pressures have worsened. Complementing that, an S&P survey cited by MarketWatch pointed to a December sag in the U.S. economy, with tariffs, inflation, and softer sales weighing on demand and hiring. Together, those data points sharpen the focus on growth/inflation trade-offs heading into year-end.
Bonds
Treasury ETFs reflect a marginal giveback:
- Long-duration TLT is at 87.71 versus 87.88 previously.
- Intermediate IEF is at 96.48 compared with 96.54.
- Short-duration SHY sits at 82.96, essentially unchanged to slightly lower from 82.96.
These moves are consistent with a curve anchored near Monday’s levels (10-year ~4.18%, 30-year ~4.84%) and a market waiting on CPI. The absence of a strong directional impulse suggests investors are reluctant to add duration ahead of the inflation data and continued Fed chair headlines.
Commodities
Commodity-linked ETFs are bid across the board:
- Gold (GLD) is at 399.18, up from 395.89.
- Silver (SLV) trades at 60.21, above 57.73.
- Oil proxy USO is at 67.38, up from 66.17.
- Natural gas (UNG) is at 12.46 versus 12.10.
- Broad commodities (DBC) are at 22.78, up from 22.58.
The firming in precious metals coincides with commentary that metals could “party like it’s the 1970s,” per MarketWatch citing Albert Edwards, though today’s backdrop is also explained by anchored long-run expectations and ongoing diversification into real assets. The move in crude-linked USO is noteworthy against MarketWatch’s assessment that 2025 has been a historic year for oil, with prices set to finish near a five-year low on abundant supply. Today’s bounce could reflect tactical positioning rather than a trend change, but it does feed through to a broader uptick in the diversified DBC basket.
FX and crypto
- EURUSD is quoted around 1.1748, modestly above the reported open near 1.1730, indicating a slightly softer dollar against the euro at midday. MarketWatch separately notes the popular AI trade has pushed some Asian currency dynamics as locals rotate into dollars to buy AI-related equities; while that story is regional, it underscores how equity narratives can feed back into FX flows.
- Bitcoin (BTCUSD) marks near 86,460, with a session high around 90,352 and low near 86,097 versus an open around 86,744, leaving it lower on the day. Bloomberg reports Bitcoin dropped below $86,000 while trending toward this year’s lows.
- Ether (ETHUSD) is quoted around 2,850, with an intraday range of roughly 2,832 to 3,030 and an open near 2,932, also softer on the session.
Company and thematic highlights
- Oracle: Multiple stories (MarketWatch and CNBC) frame Oracle as leading the market lower amid renewed concerns about funding for data centers and AI capex. Another MarketWatch piece notes that the company’s bonds have not been immune to these worries. One counterpoint from MarketWatch argues that the specific fear in focus should be “almost irrelevant,” but the net takeaway at midday is ongoing volatility around AI infrastructure financing and the timing of cash flows.
- Chips/AI: MarketWatch points to Broadcom’s worst three-day slide since 2020 and a fresh reiteration of a bearish view on Nvidia from the street’s lone bear, while another MarketWatch piece highlights J.P. Morgan’s top semiconductor picks, indicating that the debate within chips remains active. A broader MarketWatch call suggests 2026 could see investor focus rotate from hardware to software; midday price action in XLK is consistent with investors consolidating around these cross-currents.
- Airlines/Transports: Southwest’s shares hit a multiyear high on optimism around profitability into 2026, per MarketWatch. More broadly, MarketWatch discusses transports as potential leaders; that leadership lens often reflects expectations for economic health and goods flow, though today’s S&P survey cautions on demand softness in December. Frontier’s CEO change (CNBC) adds another idiosyncratic transport headline to consider.
- Media: The contested acquisition landscape remains fluid. MarketWatch reports that Netflix appears to be in the driver’s seat on a Warner Bros. Discovery deal as Paramount’s offer was rejected and financing concerns mounted. This complex of headlines underscores a consolidating industry balancing scale, content, and regulatory pathways.
- Health care and IPOs: Medline’s debut after 2025’s biggest IPO (CNBC) puts a spotlight on primary issuance capacity. The listing arrives as Pfizer fine-tunes its 2025 revenue guidance and points to a longer runway for deal-driven growth (MarketWatch, CNBC). Sector ETF XLV is little changed midday, reflecting a mixed micro tape.
- Energy and policy: Beyond crude’s macro narrative, MarketWatch shares the view that energy equities can resemble “the new bonds” in an inflationary setting. Today’s bounce in USO fits a stabilization theme more than a trend reversal, but the argument will likely persist into 2026 allocations.
- Autos and industrials: Ford’s shift away from major EV plans, tied to a $19.5–$20 billion charge and a refocus on hybrids and energy storage (MarketWatch), is a notable strategic pivot that may influence suppliers and adjacent electrification ecosystems.
- Cannabis: MarketWatch reports that cannabis shares continued to rally Tuesday after the administration signaled it is “very strongly” considering rescheduling. While that theme isn’t tradable via the instruments quoted here, it remains a prominent policy sensitivity for a subset of consumer and health-care investors.
Putting it together
Midday flows reflect a market leaning cautiously into year-end, with equities down and tech lagging as investors reassess AI capex visibility, software M&A appetite, and the pace of any 2026 handoff from hardware to software. Bonds are little changed ahead of CPI, while commodities firm—especially precious metals—on a blend of diversification demand, stable rate expectations, and tactical positioning. FX shows a slightly softer dollar against the euro, and crypto remains under pressure with Bitcoin probing the lower end of its recent range.
What to watch next
- CPI (Thursday): The delayed release will offer a crucial read on whether the pre-shutdown pickup in inflation intensified. The result will inform both the near-term rate path and sector leadership into early 2026.
- Fed chair race and Fed-speak: Headlines around the chair selection and remarks from finalists, alongside regional presidents, continue to influence rate expectations and risk appetite. Market messages remain mixed but point to disinflation and a moderate path to cuts.
- AI spending cadence: Oracle’s cycle of headlines is emblematic of a broader investor debate. Watch for updates on data center financing, hyperscaler capex plans, and software demand signals that could reframe 2026 expectations.
- Primary markets: Medline’s trading will be a fresh gauge of risk appetite for large IPOs at year-end and into 1H26.
- Oil stabilization: With 2025 crude prices trending toward multi-year lows, any sustained bounce could alter the commodity and equity factor mix (value vs. growth, cyclicals vs. defensives).
- Credit conditions: Following enforcement actions and fraud charges at a subprime auto lender (CNBC), monitor any spillovers within consumer credit and funding markets despite today’s calm rates tape.
Risks
- Upside CPI surprise that re-steepens the curve bearishly and pressures duration and growth valuations.
- Policy uncertainty from tariff litigation timelines and fiscal proposals that could shift inflation expectations.
- AI capex pullbacks or financing frictions that compress growth multiples and spill into broader tech.
- Credit normalization or idiosyncratic stress that tightens financial conditions.
- IPO indigestion if new supply meets thin liquidity into year-end.
- Crypto volatility feeding risk sentiment, with Bitcoin leaning toward year’s lows per Bloomberg reporting.
Overall, the midday setup is one of consolidation: stocks lower with tech under pressure, bonds steady ahead of data, and commodities firmer. The next directional impulse likely arrives with the CPI print and additional clarity on Fed leadership and the 2026 rate path.
Markets are lower at midday Wednesday in New York, with megacap tech and software weakness dragging on the broader tape while commodities, notably precious metals and crude-linked instruments, firm. The backdrop features subdued Treasury prices, anchored inflation expectations, and a heavy slate of policy and corporate headlines that are shaping sector performance ahead of a delayed CPI release due Thursday.
Equities and sectors
- S&P 500 proxy SPY is trading at 673.27, below Tuesday’s 678.87 close, reflecting broad softness across large caps.
- Nasdaq-100 proxy QQQ is at 603.34 versus a prior close of 611.75, underperforming as investor attention remains fixed on AI spending trajectories and software demand.
- The Dow Jones Industrial Average ETF DIA prints 480.40, modestly below 481.98 on Tuesday, while small-cap proxy IWM is at 248.18 versus 249.90 previously, indicating a mild risk-off tone across size segments.
Within sectors, the price action is consistent with a growth-led pullback:
- Technology (XLK) is at 140.14, below its 142.56 prior close, with multiple headlines reinforcing caution around AI-related capital expenditure and software strategy. Oracle is a focal point after renewed worries about data-center financing and AI spending (MarketWatch), and a separate analysis outlines how those financing questions have extended to the company’s bonds as well (MarketWatch). Combined with commentary about potential shifts in AI leadership trades and high-profile chip stock volatility, the tech complex is consolidating gains into year-end.
- Financials (XLF) trade at 54.64, essentially flat to slightly below Tuesday’s 54.64, while Health Care (XLV) at 153.99 sits just under its 154.07 prior close. The day’s marquee new listing is in health care: Medline debuted after 2025’s largest IPO, priced at $29 and raising $6.26 billion (CNBC), providing a test of late-year risk appetite in the primary market.
- Utilities (XLU) are softer at 42.57 compared with 43.04, consistent with a modest drift higher in longer-term yields earlier in the week and a rotation into cyclicals tied to commodities.
Macro backdrop: rates, inflation, expectations
The latest available Treasury curve levels from Monday, December 15, show the 2-year at 3.51%, 5-year 3.73%, 10-year 4.18%, and 30-year 4.84%. That curve configuration keeps term premiums in focus but conveys no acute stress, aligning with a modest dip in long-duration bond ETFs midday (see Bonds below). On inflation, the most recent index levels show CPI at 324.368 and core CPI at 330.542 (September reading). While those are index levels rather than rates of change, market-based inflation expectations remain contained: 5-year breakevens sit near 2.35%, the 10-year at 2.27%, and the 5y5y forward at 2.18% (November).
Policy communications are front and center. A MarketWatch interview notes that Fed chair finalist Christopher Waller sees inflation starting to decline over the next three to four months and room for a moderate pace of rate cuts, roughly 100 basis points. Separately, CNBC reports Waller emphasized he would “absolutely” stress Federal Reserve independence. At the same time, Atlanta Fed President Raphael Bostic signaled concern that fiscal proposals could complicate the inflation outlook, arguing for no rate cuts in 2026 (MarketWatch). The mixed but generally disinflation-consistent messaging aligns with anchored expectations, but with enough policy variance to keep duration positioning tactical.
Thursday’s delayed CPI release looms large. MarketWatch highlights that inflation was rising before the government shutdown that delayed the data; the overdue report will help clarify whether recent price pressures have worsened. Complementing that, an S&P survey cited by MarketWatch pointed to a December sag in the U.S. economy, with tariffs, inflation, and softer sales weighing on demand and hiring. Together, those data points sharpen the focus on growth/inflation trade-offs heading into year-end.
Bonds
Treasury ETFs reflect a marginal giveback:
- Long-duration TLT is at 87.71 versus 87.88 previously.
- Intermediate IEF is at 96.48 compared with 96.54.
- Short-duration SHY sits at 82.96, essentially unchanged to slightly lower from 82.96.
These moves are consistent with a curve anchored near Monday’s levels (10-year ~4.18%, 30-year ~4.84%) and a market waiting on CPI. The absence of a strong directional impulse suggests investors are reluctant to add duration ahead of the inflation data and continued Fed chair headlines.
Commodities
Commodity-linked ETFs are bid across the board:
- Gold (GLD) is at 399.18, up from 395.89.
- Silver (SLV) trades at 60.21, above 57.73.
- Oil proxy USO is at 67.38, up from 66.17.
- Natural gas (UNG) is at 12.46 versus 12.10.
- Broad commodities (DBC) are at 22.78, up from 22.58.
The firming in precious metals coincides with commentary that metals could “party like it’s the 1970s,” per MarketWatch citing Albert Edwards, though today’s backdrop is also explained by anchored long-run expectations and ongoing diversification into real assets. The move in crude-linked USO is noteworthy against MarketWatch’s assessment that 2025 has been a historic year for oil, with prices set to finish near a five-year low on abundant supply. Today’s bounce could reflect tactical positioning rather than a trend change, but it does feed through to a broader uptick in the diversified DBC basket.
FX and crypto
- EURUSD is quoted around 1.1748, modestly above the reported open near 1.1730, indicating a slightly softer dollar against the euro at midday. MarketWatch separately notes the popular AI trade has pushed some Asian currency dynamics as locals rotate into dollars to buy AI-related equities; while that story is regional, it underscores how equity narratives can feed back into FX flows.
- Bitcoin (BTCUSD) marks near 86,460, with a session high around 90,352 and low near 86,097 versus an open around 86,744, leaving it lower on the day. Bloomberg reports Bitcoin dropped below $86,000 while trending toward this year’s lows.
- Ether (ETHUSD) is quoted around 2,850, with an intraday range of roughly 2,832 to 3,030 and an open near 2,932, also softer on the session.
Company and thematic highlights
- Oracle: Multiple stories (MarketWatch and CNBC) frame Oracle as leading the market lower amid renewed concerns about funding for data centers and AI capex. Another MarketWatch piece notes that the company’s bonds have not been immune to these worries. One counterpoint from MarketWatch argues that the specific fear in focus should be “almost irrelevant,” but the net takeaway at midday is ongoing volatility around AI infrastructure financing and the timing of cash flows.
- Chips/AI: MarketWatch points to Broadcom’s worst three-day slide since 2020 and a fresh reiteration of a bearish view on Nvidia from the street’s lone bear, while another MarketWatch piece highlights J.P. Morgan’s top semiconductor picks, indicating that the debate within chips remains active. A broader MarketWatch call suggests 2026 could see investor focus rotate from hardware to software; midday price action in XLK is consistent with investors consolidating around these cross-currents.
- Airlines/Transports: Southwest’s shares hit a multiyear high on optimism around profitability into 2026, per MarketWatch. More broadly, MarketWatch discusses transports as potential leaders; that leadership lens often reflects expectations for economic health and goods flow, though today’s S&P survey cautions on demand softness in December. Frontier’s CEO change (CNBC) adds another idiosyncratic transport headline to consider.
- Media: The contested acquisition landscape remains fluid. MarketWatch reports that Netflix appears to be in the driver’s seat on a Warner Bros. Discovery deal as Paramount’s offer was rejected and financing concerns mounted. This complex of headlines underscores a consolidating industry balancing scale, content, and regulatory pathways.
- Health care and IPOs: Medline’s debut after 2025’s biggest IPO (CNBC) puts a spotlight on primary issuance capacity. The listing arrives as Pfizer fine-tunes its 2025 revenue guidance and points to a longer runway for deal-driven growth (MarketWatch, CNBC). Sector ETF XLV is little changed midday, reflecting a mixed micro tape.
- Energy and policy: Beyond crude’s macro narrative, MarketWatch shares the view that energy equities can resemble “the new bonds” in an inflationary setting. Today’s bounce in USO fits a stabilization theme more than a trend reversal, but the argument will likely persist into 2026 allocations.
- Autos and industrials: Ford’s shift away from major EV plans, tied to a $19.5–$20 billion charge and a refocus on hybrids and energy storage (MarketWatch), is a notable strategic pivot that may influence suppliers and adjacent electrification ecosystems.
- Cannabis: MarketWatch reports that cannabis shares continued to rally Tuesday after the administration signaled it is “very strongly” considering rescheduling. While that theme isn’t tradable via the instruments quoted here, it remains a prominent policy sensitivity for a subset of consumer and health-care investors.
Putting it together
Midday flows reflect a market leaning cautiously into year-end, with equities down and tech lagging as investors reassess AI capex visibility, software M&A appetite, and the pace of any 2026 handoff from hardware to software. Bonds are little changed ahead of CPI, while commodities firm—especially precious metals—on a blend of diversification demand, stable rate expectations, and tactical positioning. FX shows a slightly softer dollar against the euro, and crypto remains under pressure with Bitcoin probing the lower end of its recent range.
What to watch next
- CPI (Thursday): The delayed release will offer a crucial read on whether the pre-shutdown pickup in inflation intensified. The result will inform both the near-term rate path and sector leadership into early 2026.
- Fed chair race and Fed-speak: Headlines around the chair selection and remarks from finalists, alongside regional presidents, continue to influence rate expectations and risk appetite. Market messages remain mixed but point to disinflation and a moderate path to cuts.
- AI spending cadence: Oracle’s cycle of headlines is emblematic of a broader investor debate. Watch for updates on data center financing, hyperscaler capex plans, and software demand signals that could reframe 2026 expectations.
- Primary markets: Medline’s trading will be a fresh gauge of risk appetite for large IPOs at year-end and into 1H26.
- Oil stabilization: With 2025 crude prices trending toward multi-year lows, any sustained bounce could alter the commodity and equity factor mix (value vs. growth, cyclicals vs. defensives).
- Credit conditions: Following enforcement actions and fraud charges at a subprime auto lender (CNBC), monitor any spillovers within consumer credit and funding markets despite today’s calm rates tape.
Risks
- Upside CPI surprise that re-steepens the curve bearishly and pressures duration and growth valuations.
- Policy uncertainty from tariff litigation timelines and fiscal proposals that could shift inflation expectations.
- AI capex pullbacks or financing frictions that compress growth multiples and spill into broader tech.
- Credit normalization or idiosyncratic stress that tightens financial conditions.
- IPO indigestion if new supply meets thin liquidity into year-end.
- Crypto volatility feeding risk sentiment, with Bitcoin leaning toward year’s lows per Bloomberg reporting.
Overall, the midday setup is one of consolidation: stocks lower with tech under pressure, bonds steady ahead of data, and commodities firmer. The next directional impulse likely arrives with the CPI print and additional clarity on Fed leadership and the 2026 rate path.