20. Weekly Market Recap: Key Movements & Insights
🌟 S&P 500's Next Chapter: Breaking Away from Tech Dominance?
A Warm Note to Our Readers
As we wrap up this holiday week (and prepare for another short one next week), we want to take a moment to thank you for your incredible support during our first 8 months on Substack. Your engagement, feedback, and enthusiasm have been the driving force behind everything we do.
We’re excited to share that we’re working on two new stock ideas for our paid subscribers, and we’ve also got a couple of free articles in the pipeline that we think you’ll find interesting and valuable. Stay tuned—there’s a lot to look forward to in 2025!
As we head into the new year, we want to leave you with key points to reflect on. These ideas help you think about the bigger picture and prepare for what’s ahead in the markets. Whether you’re a seasoned investor or just starting, we hope these insights will give you something meaningful to consider as we step into 2025 together.
Thank you again for being part of this journey with us. Here’s to a successful and rewarding year ahead!
What Will Happen with Interest Rates in 2025?
The Federal Reserve (the Fed) has a tough job ahead in 2025.
It needs to balance two key things: inflation (how fast prices are rising) and the job market (how many people are working). Right now, both seem stable. Unemployment is just above 4%, and the number of people looking for work hasn’t changed much recently. However, changes in immigration policies could make it harder for companies to find workers, which might push wages higher. If wages rise too much, it could lead to more inflation, and the Fed will need to act.
On inflation, the latest data shows prices are rising at a manageable pace—2.6% compared to last year. This is slightly higher than the previous month but still under control. The Fed has made progress in fighting inflation, but it’s not completely done yet. In 2025, the Fed will need to carefully decide whether to raise or lower interest rates based on how these factors play out.
What Policies Will Be Put in Place?
Politicians often talk about big ideas, but what matters is what they do. With Republicans now in control of Congress and the White House, some of their campaign promises might turn into real policies. For example:
Tariffs on Imports: The new administration has talked about adding high taxes (tariffs) on goods from countries like China, Mexico, and Canada. This could make some products more expensive and create uncertainty in global trade. China has already responded by limiting exports of key materials needed for things like semiconductors and satellites. But it’s unclear if these tariffs will happen or how they’ll affect the economy.
Deregulation: The government is expected to reduce rules for businesses, especially in areas like mergers and acquisitions (when companies combine). This could help businesses grow and boost the economy, but we’ll need to wait and see how these changes unfold.
Will More Companies Start Growing Their Profits?
In the past two years, most of the stock market’s gains have come from just a few giant tech companies, often called the "Magnificent Seven" (like Apple, Microsoft, and others). These seven companies have grown their profits by 40%, while the rest of the companies in the S&P 500 have only grown by 2%. This means a small group of companies has been driving most of the market’s success.
In 2025, this could change. The other 493 companies in the S&P 500 are expected to grow their profits much faster—about five times more than they did in 2024. Meanwhile, the big tech companies might slow down. If this happens, investors might start paying more attention to smaller and mid-sized companies or industries outside of technology. This could create new opportunities for growth in the stock market.
Index Insights: How Major Benchmarks Performed Last Week
Price>MA10: 🔴
Price>MA20: 🟢
MA10>MA20: 🟢
Market Trend: 🔴 (When Price and Moving Averages are all green, also the Market Trend will be green and positive)
Trend Signal: 🟢
Price>MA10: 🔴
Price>MA20: 🔴
MA10>MA20: 🔴
Market Trend: 🔴
Trend Signal: 🔴
Price>MA10: 🔴
Price>MA20: 🔴
MA10>MA20: 🔴
Market Trend: 🔴
Trend Signal: 🔴
Financial Sector Performance: Winners and Losers from Last Week
📊 Weekly Market Sector Snapshot: Leaders & Laggards
💻 Technology (+2.25%)
Tech leads the pack this week with the strongest performance.
Sector leaders: Computer Systems and Software-Application
⛽ Energy (+2.11%)
Energy shows strong momentum, ranking second this week.
Sector leaders: Oil & Gas Midstream
🏦 Financial Services (+2.01%)
Financials post solid gains, rounding out the top three.
Sector leaders: Credit Services and Capital Markets
🏢 Real Estate (+1.84%)
Real estate rebounds with notable gains.
Sector leaders: Hotel & Motel and Residential REIT
⚡ Utilities (+1.84%)
Utilities maintain steady growth this week.
Sector leaders: Independent Power Producers
🏥 Healthcare (+1.42%)
Healthcare posts moderate gains, continuing its recovery.
Sector leaders: Medical Distribution
⭐ Communication Services (+1.31%)
A positive week for Communication Services.
Sector leaders: Pay TV
📱 Consumer Cyclical (+1.05%)
Consumer Cyclical sees modest growth.
Sector leaders: Luxury Goods and Auto Manufacturers
🏭 Industrials (+1.01%)
Industrials post slight gains, showing resilience.
Sector leaders: Airlines and Airports & Air Services
🏗️ Basic Materials (+0.8%)
Basic Materials sees the smallest gain among sectors.
Sector leaders: Paper & Paper Products and Building Materials
🛡️ Consumer Defensive (-0.34%)
The only sector to post a decline this week, Consumer Defensive struggles to maintain momentum.
Sector leaders: Grocery Stores and Pharma Retailers
📉 Summary:
This week saw widespread gains across sectors, with Technology (+2.25%) and Energy (+2.11%) leading the charge. Consumer Defensive (-0.34%) was the only sector to post a decline, underperforming the broader market.
🌟 Market Pulse: Solar and Semiconductors Lead Market Gains
☀️ Solar Shines Bright (+7.13%)
Solar dominates the market this week, leading all sectors with over 7% gains. This exceptional performance highlights strong momentum in renewable energy investments.
💻 Semiconductors Surge (+5.31%)
Semiconductors post impressive gains, reflecting robust demand and innovation in the tech industry.
🏬 Department Stores Show Strong Growth (+5.07%)
Department stores demonstrate significant momentum, posting solid gains that could reflect positive developments in retail demand and consumer spending.
👗 Luxury Goods Rise (+4.69%)
The luxury goods sector shows notable strength, posting healthy gains and indicating robust consumer demand in the premium market.
🖥️ Computer Hardware Advances (+4.31%)
Computer hardware sees strong growth, driven by increased demand for tech products.
🚗 Auto Parts Gain (+3.79%)
Auto parts post solid gains, reflecting resilience in the automotive supply chain.
✈️ Airports & Air Services Momentum (+3.75%)
Airports and air services show strong growth, reflecting a steady recovery in travel demand.
🚢 Marine Shipping (+3.49%)
Marine shipping posts healthy gains, indicating robust activity in global trade.
🏥 Healthcare Plans (+3.36%)
Healthcare plans see positive momentum, driven by increased demand for health services.
⛽ Oil & Gas E&P (+3.15%)
Oil and gas exploration and production post steady gains, reflecting resilience in the energy sector.
🚀 Top Market Gainers: Battery Tech, Cybersecurity, and Clean Energy Lead
SES AI Corporation (SES) +478.41%
🔋 Urban Air Mobility Push: Partnered with SoftBank to develop advanced battery solutions for drones and aviation applications, marking a strategic entry into the UAM market.
Intrusion Inc (INTZ) +433.47%
🛡️ Product Launch: Introduced Intrusion Shield Sentinel, a high-performance cybersecurity monitoring system for large enterprises, supporting up to 100 Gbps bidirectional monitoring with comprehensive threat detection capabilities.
Direct Digital Holdings Inc (DRCT) +358.18%
📈 Market Movement: Significant gain without specific news catalysts.
Graphjet Technology (GTI) +340.09%
🏭 Green Innovation: Received visit from Malaysian Deputy Minister at their groundbreaking green graphite facility. Stock benefited from broader battery sector momentum.
Snow Lake Resources Ltd (LITM) +335.73%
⚡ Corporate Milestones: Snow Lake Resources has secured its 2025 operations with a successful US$6.45 million public offering while completing its Phase 1 drill program at the Engo Valley Uranium Project. The company is set to begin Phase 2 drilling in early 2025, with current winter drilling campaigns progressing as planned through December 2024, driving investor confidence.
🔻 Biggest Decliners: IPO Schemes and Clinical Setbacks
Linkers Industries Ltd (LNKS -66.04%)
⚠️ Market Concerns: Identified as a potential pump-and-dump IPO scheme.
MGO Global Inc (MGOL -52.38%)
💰 Dilution Impact: Announced pricing of upsized $6.0M public offering.
Renovaro Inc (RENB -44.08%)
🔬 Grant Success: Despite the decline, subsidiary RenovaroCube secured Eurostars funding for an AI-driven cancer diagnostics project.
XBiotech Inc (XBIT -40.44%)
❌ Clinical Setback: Paused rheumatology program due to concerning findings in recent rheumatoid arthritis study.
YSX Tech Co.Ltd (YSXT -40.00%)
⚠️ Market Concerns: Identified as a potential pump-and-dump IPO scheme.
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