Closing Recap

Monday, December 15, 2025

U.S. stocks opened higher after futures advanced overnight, rebounding from Friday’s drop for the S&P 500 and Nasdaq, but quickly erased gains, sliding on the day to finish lower in a very quiet/low volume trading day. It could have been the start of the holiday week or investors waiting for the heavy economic data dump this week or central bank meetings taking place for the lackadaisical market reaction today. Either way, stock market news flow and market action was nothing to write home about ahead of tomorrow’s delayed Nonfarm Payroll report. Also, this week, the November Consumer Price Index (CPI) inflation report later on Thursday as well as the Bank of Japan (rate hike on the table) and European Central Bank (no change expected) policy meetings this week. Last week the FOMC announced a 25 bps interest rate policy cut (as expected) in a 9-3 vote. Today was filled with several Fed speakers ahead of the holiday break. Among leaders today, Healthcare, Utilities, Consumer Discretionary (thanks to TSLA rise) while Energy, Technology and Materials were down the most.

Another day, another Wall Street outlook for the S&P in 2026 as Citigroup set a 2026 S&P 500 base case target of 7700, predicated on an aggressive $320 in index earnings. Ai investment tailwinds persist but performance dispersion within both the enablers and adopters of the technology is an ongoing dynamic. Broadening beyond that cohort is a key narrative. This includes both across the S&P 500 as well as down into US Small/Mid Cap. As Citi enters the fourth year of this current bull phase, ongoing bouts of volatility should be expected and may be more acute given implicit growth expectations.

U.S. Attorney General Bondi said the Justice Department/FBI foils ‘terror plot’ in California’s Orange County and Los Angeles; four individuals connected to the Los Angeles area plot arrested over the weekend. FBI director: a Fifth individual believed to be planning a separate attack arrested by FBI New Orleans. US charges four with conspiracy and possession of unregistered destructive device, complaint shows. Bombing plot called for planting explosive Devices at five locations targeting two U.S. companies at midnight on new year’s eve in the Los Angeles area.

• U.S. December NAHB Housing market index 39 (consensus 39) versus 38 in November (previous 38), index of current single-family home sales 42 versus 41 in November (previous 41); index of home sales over next six months 52 versus 51 in November (previous 51), index of prospective buyers 26 versus 26 in November (previous 26).

• Both the US dollar (near 2 week lows) and Treasury yields were lower. The U.S. Federal Reserve last week delivered a 25-basis-point rate cut in a divided vote, with further easing dependent on the labor market and inflation levels. Markets are currently pricing in two U.S. rate cuts next year, with investors eyeing this week’s U.S. nonfarm payrolls report for further clues on monetary policy. Bitcoin tapped lows of $85,264, before paring losses but still down fell over around $86,000 (remains down more than 30% from October highs) while Ethereum fell -5% at $2,922.
• The euro rose to a 10-week high against a weaker dollar around 1.1765 before paring gains and slipping later in the day, as investors await key U.S. jobs data on Tuesday and a decision by the European Central Bank (ECB) on Thursday, and after a survey showed an unexpected contraction in New York State manufacturing activity. The Federal Reserve Bank of New York said its manufacturing index fell 22.6 points to minus -3.9 in December, below the consensus reading of 10.0. The dollar weakened against the Japanese yen as well ahead of the Bank of Japan expected rate hike.

• Specialty Retail: IRBT shares tumbled after filing for Chapter 11 protection in Delaware bankruptcy court on Sunday after raising concerns about staying in business in March. According to the bankruptcy plan, co will be taken private by its primary manufacturer Picea, which will also cancel two loans IRBT owes.
• Hardline/Broadline Retail: COST was downgraded to Sell from Hold and lower PT to $769 from $906 at Roth Capital saying despite a Q1 earnings beat, underlying metrics are concerning: 1) renewal rates are fading; 2) paid members have slowed, possibly negative q/q (adjusted for openings); and 3) Y/y comp traffic is decelerating and 4) competition is intensifying: as WMT, BJ are dramatically increasing investment/openings.
• In Dollar/Discount Retail: DG was upgraded to Overweight at JP Morgan and raised tgt to $166 from $128 based on ~20x its FY27E EPS of $8.30; sees upside to company’s 2%-3% same-store-sales growth outlook for fiscal 2026 given its exposure to the employed low-income consumer and higher level of middle income consumers trading down

• Gaming and Lodging Outlook for 2026 at Goldman Sachs as they upgraded MAR, HLT and LVS to Buy, while downgrading WH, CHH, CZR to Neutral. The firm said lean into high-end Hotel franchises in 2026 as these brands continue to add rooms and we look for an acceleration in RevPAR growth (raise MAR, HLT and cut WH, CHH), while in gaming, they believe it is too early to call an inflection and still see downside to estimates. Upgrade LVS to Buy to capture its exposure to Macau where expect gross gaming revenue to exhibit sustained momentum and downgrade CZR to Neutral while its favorite gaming stock is WYNN.
• In Autos: GM named top autos pick, Reiterate Buy at UBS as raise tgt to $97 from $85 as it rolls forward its valuation to 2027 and says sees many positive factors that can drive GM stock higher: it continues to see a return of GMNA margins to the 8-10% range, potentially as early as 2026 with an eventual path to potentially higher margins than pre-tariff levels, macro dependent. TSLA hit fresh 52-week highs. In auto dealers, @GuyDealership tweets: "Used Car inventory just hit a 2025 high: At the start of December, dealers were sitting on 2.31M used vehicles, the highest level this year. And average days’ supply ticked up to 50 days, even amid really healthy demand.”
• Leisure & Entertainment: LYV and its subsidiary Ticketmaster must face a class action on behalf of millions of Americans for allegedly overcharging them for events at major concert venues as a U.S. District Judge ruled that the plaintiffs met the criteria to expand their lawsuit into a class action seeking 15 years of alleged damages tied to the purchase of more than 400M tickets. IMAX was upgraded to Overweight from Neutral at JP Morgan and raised tgt to $47 from $32 as believes IMAX momentum can accelerate on a strong slate that includes Avatar: Fire and Ash, The Odyssey, and Narnia, the latter of which carries an exclusive structure that could be a template for select future releases. MSGS was downgraded to Peer Perform at Wolfe Research as believes the equity upside from here relies on the Dolan family selling all or a minority stake in the teams, which is something they have never done.

• In Refiners: PSX set a $2.4 billion capital budget for next year, comprising $1.1 billion for sustaining projects and $1.3 billion for growth projects. CEO Mark Lashier said that the budget reflects the Houston-based oil refiner’s commitment to capital discipline and maximizing shareholder returns. In its midstream business, Phillips’ $1.1 billion budget includes $400 million for sustaining projects and $700 million for growth projects.
• In Industrials: TT was upgraded to Overweight with $500 PT at Keybanc saying they believe the recent pullback in shares offers a rare entry point into one of the highest quality operators on its list, and best-in-class CHVAC portfolio. The firm has long been impressed by TT’s market outperformance, and sales/order trajectory, particularly in the Applied America’s business.

• In Insurance: CNO was upgraded to Buy at Jefferies on its view that the company will likely beat its 2027 ROE guide of 12% with further upside, following US Life Insurance 2026 outlook and replace EQH with LNC as Franchise Pick saying for 2026, stays constructive but ratchet up its focus on catalysts and contra consensus calls (CCCs). Top 2026 picks (in order) are LNC, UNM, AMP, CNO, PRU, EQH, MET, CRBG and RGA.
• In REITs: Multifamily sector view upgraded to Overweight from Equal-Weight, due to valuation at Stifel. After significantly outperforming in 2024 (+20.5% vs RMS +8.8%), the Multifamily sector has significantly underperformed YTD through November 28 (-9.8% vs RMS +5.4%). Q325 numbers were uninspiring, Q3/October leasing spreads were not enough to bring investors back into the sector, and Stifel believes that final FY25 results will be pedestrian. However, Stifel is upgrading its view of the sector to Overweight from Equal-Weight, due to valuation, a more favorable supply-demand dynamic, and potentially inflecting fundamentals (CPT favored name).

• BMY was upgraded to Buy from Neutral at Bank America (raise tgt to $61) predicated on the strength of BMY’s R&D pipeline where it expects 4-6 programs to deliver key de-risking catalysts in the near-term.
• IMNM announces positive topline results from Phase 3 RINGSIDE trial of Varegacestat in patients with desmoid tumors; registrational trial met primary endpoint, with Varegacestat significantly improving progression-free survival vs. placebo (hazard ratio = 0.16, p<0.0001); trial also met all key secondary endpoints.
• KYTX announces positive topline data from registrational KYSA-8 trial of Miv-cel in stiff person syndrome. Miv-cel achieved statistically significant clinical benefit across all primary and secondary endpoints, reversing disability and eliminating immunotherapies after a single dose.
• MIST said the FDA approved the first commercial product, Cardamyst, a nasal spray for adults with a heart condition, designed to rapidly resolve episodes of paroxysmal supraventricular tachycardia; the spray is expected to be available in retail pharmacies in Q1 2026.
• SNY flagged another delay to a U.S. regulatory decision for its experimental multiple sclerosis ‌drug and disappointing results from a late-stage study. Sanofi said the FDA decision on its tolebrutinib drug to treat non-relapsing secondary progressive multiple sclerosis will ⁠likely be delayed until ‌the first quarter of 2026.

• In Medical Equipment: HAE was downgraded from Buy to Hold at Needham saying checks have made them more concerned about HAE’s Vascular closure device competition. Both Abbott (ABT) and Cordis (private) have newer venous closure indications/devices and new sales teams focused on electrophysiology procedures.
• In Healthcare Technology: DOCS was upgraded to Overweight from Equal Weight at Morgan Stanley saying underperformance is at odds with the firms checks on the business and strengthening platform Engagement as sees an expanding market for HCP-targeted marketing led by Ai-enabled workflow Tools.

• In Chemical research: BMO Capital upgraded ASH to Outperform from Market Perform with a price target of $71, up from $61 saying the company has largely cleaned up its portfolio and is firmly focused on improving costs while continuing to drive its innovation pillars (for longer-term growth) where BMO has seen encouraging signs. The form also downgraded LYB to Underperform (tgt to $36 from $48) given the significant fundamental and financial pressures the company finds itself in as it heads into 2026. APD was downgraded to Neutral from Buy at Citigroup and cut tgt to $245 from $300 saying while the firm remains encouraged by efforts to right-size the cost structure and clean up underperforming projects, it believes the risk profile and cash flow overhang justify the recent de-rating.
• Fertilizer stocks MOS, NTR, CF, IPI gave up recent gains, under pressure after the U.S. announced it would remove sanctions on Belarusian potash fertilizers. According to Bloomberg, special envoy John Coale said President Trump ordered the sanctions lifted, effective immediately. More restrictions might be eased as U.S.-Belarus relations normalize, Coale added.

• In Hardware & Networking: JP Morgan downgraded INGM, NSIT to Underweight in hardware and networking 2026 outlook and named ANET, APH top picks saying they have a favorable view on Ai stocks for another year heading into 2026 and believe investors should stay the course with their positioning in the sector. Downgrade Ingram and Insight to Underweight despite reasonable valuations for both, as it expects a muted enterprise spending environment, choppiness in demand elasticity from customers reacting to memory led price increases across all IT products, and more specifically potential digestion in PC market volumes.
• Data Center/AI sector/stocks extend last week declines with CRWV, NBIS, ETN, others as well as Bitcoin miners that last few months have pivoted toward Ai infrastructure and high-performance Computing (HPC) such as CIFR, CLSK, IREN, WULF, HUT and other are seeing further pullbacks after last week ORCL concerns on delayed data center build as well as guidance/results in space from ORCL.
• In Tech Equipment: LAZR shares fell after saying initiates voluntary chapter 11 proceedings to facilitate value-maximizing sale process; to sell LSI to Quantum Computing for $110M; enters chapter 11 with 91.3% noteholder support.
• US listed China stocks were weaker (BABA, BIDU, PDD, XPEV) a Retail sales in China grew 1.3% in November, according to data released Monday by China’s National Bureau of Statistics. That was a slowdown from the 2.9% year-over-year growth in October and the weakest overall growth since 2022.

• INTC is in advanced discussion with privately owned SambaNova Systems Inc. to acquire the artificial intelligence chip startup for roughly $1.6B, including debt, Bloomberg News reported, citing people familiar with the matter. https://tinyurl.com/mcrusv9h
• WDC, STX, MPWR among chip related stocks added to the Nasdaq 100 annual reconstitution index