The final month of the year begins Monday, and investors will look for a smooth month to turn the year around after the Nasdaq Composite (^IXIC) snapped a seven-month winning streak in November trading while the S&P 500 (^GSPC) returned within 1% of a record high.
On Friday, markets ended the week notching their fifth straight session of gains to close the month up and down in the holiday-shortened trading session. And even snapping its monthly winning streak, the Nasdaq is also within 3% of a record. The Dow is less than 2% off its record.
And while the last five days have been good for markets, the past month has been anything but steady, as concerns over a potential AI bubble weighed on some market heavyweights. Over the past month, Meta ( META ) stock is down 13%, while Nvidia ( NVDA ) shares are down nearly 8%. Oracle ( ORCL ) has fallen nearly 30% over the period.
The exception is Google (GOOG), whose stock is up nearly 20% after a strong earnings report, positive feedback on its Gemini 3 model, and, this past week, reports of a multibillion-dollar AI chip deal with Meta.
In the week ahead, investor focus will remain on the odds of a rate cut at the Federal Reserve’s December meeting, with traders currently predicting an 86.9% chance of a quarter-point cut. As the start of a week and a half before the Federal Open Market Committee meets on December 9-10, the Fed entered its mandatory blackout period on Saturday.
Reports this past week also suggested that the Trump administration is close to landing a nominee to succeed Jerome Powell as Fed chairman, with Kevin Hassett, director of the National Economic Council, seen as the front-runner for the nomination.
The economic calendar will continue its slow normalization after the 43-day US government shutdown threw data collection into chaos, including private reports on US manufacturing activity, services sector activity, and ADP’s monthly private payrolls report.
On the corporate earnings side, bargain retailers Dollar Tree ( DLTR ), Dollar General ( DG ), and Five Below ( FIVE ) are all reporting, while Salesforce ( CRM ) and CrowdStrike ( CRWD ) will feature from the tech industry.
Federal Reserve Chairman Jerome Powell looks on as U.S. President Donald Trump holds a document during a tour of the Federal Reserve Board building, which is currently under renovation, in Washington, DC, U.S., July 24, 2025. REUTERS/Kent Nishimura/File photo ·Reuters / Reuters
Investors have been picking up on several bearish signs over the past month.
Famous short sellers Michael Burry and Jim Chanos made calls against AI trades. Nvidia leadership published a poorly-received letter trying to emphasize that the chipmaking giant does not, in fact, have Enron-like structural problems. Elsewhere, the biggest US retailers saw mixed results in third-quarter earnings as consumers were squeezed by rising prices.
Strategists on the street, however, see a better picture for the stock market going forward.
Top equity strategists at JPMorgan see the S&P 500, currently sitting at 6,849, reaching 7,500 by the end of 2026 — a roughly 10% rally. If the Federal Reserve continues to cut interest rates, the bank sees a case for the index to exceed 8,000.
“The United States is poised to become the world’s growth engine, driven by a resilient economy and an AI-driven supercycle that is fueling record capex and rapid earnings expansion,” JPMorgan strategists wrote in a client note.
Elsewhere on the street, HSBC strategists set their 2026 price target at 7,500 while Deutsche Bank predicted the index would reach 8,000. All three firms pegged their bullish calls on the AI trade.
“After that [in the 1990s equity boom]As of today, technology is leading, return concentration is high, and a new technology is promising to be transformative. We expect equities to continue to be supported by an AI-led capex boom,” HSBC strategists wrote.
At Deutsche Bank, strategists expect volatility between now and what they see as a distinctly more efficient — and consequently higher-paying — corporate environment as a result of AI innovation.
“Given the pace of technological development, it is almost impossible to believe that this will not translate into meaningful productivity gains in the coming years,” the Deutsche Bank team wrote.
“In the meantime, markets can swing sharply between boom-and-bust stories, regardless of their ultimate destination. So, while our global economists and strategists remain largely positive for 2026, don’t expect any layer-up in volatility or sentiment swings.”
A bullish outlook for 2026, then, essentially calls for a replay of 2025, with November serving as a prime example of what it takes to achieve above-average returns.
“Volatility is like a toll that investors pay for attractive long-term returns,” LPL Financial chief equity strategist Jeff Buchbinder wrote in an email. “This year again offers us this powerful lesson.”
Traders Patrick Casey, left, and Timothy Nick work on the floor of the New York Stock Exchange, Wednesday, Nov. 19, 2025, in New York. (AP Photo/Richard Drew) ·The Associated Press
Financial Statistics: S&P Global US manufacturing PMI, November final reading (51.9 previously); ISM Manufacturing, November (49 expected, 48.7 prior)
Income: Credo Technology Group (CRDO), MongoDB (MDB), New Fortress Energy (NFE)
Financial Statistics: No significant economic data.
Income: CrowdStrike (CRWD), The Bank of Nova Scotia (BNS), Marvell Technology (MRVL), Okta (OKTA), American Eagle Outfitters (AEO)
Financial Statistics: MBA mortgage applications, week ended Nov. 28 (up 0.2%); ADP Employment Change, November (+20,000 expected, +42,000 prior); Import Price Index, month-on-month, September (+0.1% expected, +0.3% previously); Export Price Index, month-on-month, September (0% expected, +0.3% earlier); Industrial production, month-on-month, September (+0.1% expected, +0.1% previously); S&P Global US Services PMI, November, last reading (55 ago); S&P Global US Composite PMI, November, last reading (55 ago); ISM Services Index, November (52 expected, 52.4 prior)
Income: Salesforce (CRM), Royal Bank of Canada (RY), Snowflake (SNOW), Dollar Tree (DLTR), Five Below (FIVE), Macy’s (M), Uranium Energy Corp. (UEC), C3.ai (AI)
Financial Statistics: Challenging job cuts, year-over-year, November (+175.3% prior); Initial jobless claims, week ended Nov. 29 (216,000 earlier); Continuing claims, week ended November 22 (1.96 million prior)
Income: Toronto-Dominion Bank ( TD ), Bank of Montreal ( BMO ), Kroger ( KR ), Hewlett Packard Enterprise ( HPE ), Alta Beauty ( Ulta ), Dollar General ( DG ), Samsara ( IOT ), The Cooper Companies ( COO ), DocuSign ( DOCU ), Brown-Forman Corporation ( BF-A, RUKBRBB )
Financial Statistics: Personal Income, September (+0.3% expected); Personal Spending, September (+0.3% expected); Real Personal Spending, September (0.1% expected); PCE price index, month-on-month, September (+0.3% expected); PCE price index, year-over-year, September (+2.8% expected); Core PCE price index, month-on-month, September (+0.2% expected); Core PCE price index, year-over-year, September (+2.8% expected); University of Michigan sentiment, December preliminary reading (52 expected, 51 already)
Income: Victoria’s Secret (VSCO)
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him jake.conley@yahooinc.com.
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