As we enter the final weeks of the year, we hope you and your families enjoyed a warm and restorative Thanksgiving. The holiday season often brings perspective: a reminder that markets move in cycles, while long-term planning and disciplined decision-making remain the foundation of durable financial outcomes. With that in mind, we look ahead to the close of 2025 with a focus on clarity, balance, and staying grounded in the data.
Market Overview: Equity Trends and Near-Term Volatility
Equity markets are closing November on uneven footing. The S&P 500 has bounced off its monthly low, but the path forward may remain volatile. While the index remains firmly positive for the year, up over 15% YTD, the foundations of the rally appear to have weakened. Just 51% of S&P 500 companies are above their 200-day moving average according to LPL Financial analysts, signaling potentially fading breadth and a market increasingly driven by fewer names.
Furthermore, the recent drawdown has broken important technical structures. At the end of October, the S&P 500 slipped below the upward trend it had followed for nearly three years. That doesn’t signal a bear market, but it may suggest the market has shifted into a short-term cooling phase. Historically, when the S&P 500 has rallied more than 30% over several months without even a 3% pullback—as it did this year with a 33.6% gain over 190 days—the following three months have, on average, produced negative returns, according to Bespoke Investment Group analysts Of course, historical patterns do not guarantee future outcomes, but they help frame why we believe there will be heightened volatility over the short term.
AI: early-cycle infrastructure boom, not yet a full bubble
Even Nvidia, the market’s flagship beneficiary of the AI boom, wasn’t immune to the recent market selloff, falling as much as 13% this month. The stock’s pullback instead appears to reflect growing attention to competitive dynamics, particularly as reports surface that Google and Meta are in talks for Meta to begin using Google’s TPUs. If finalized, such a move could potentially reshape the AI compute-infrastructure landscape, signaling a more competitive—and potentially more price-sensitive—phase of the AI hardware cycle…
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