MARKET COMMENTARY
We have a quiet week ahead with the holidays in full swing. Markets will receive some very delayed GDP data, but other than that, the only report to look out for is consumer confidence. Whether it be concerns about affordability, if we’re in an AI bubble or general uncertainty about new legislature; consumer and investor sentiment was in the driver seat in 2025. Consumer confidence will give us one last peek into consumer attitudes, buying intentions, vacation plans, and expectations for inflation, stock prices, and interest rates. It’s expected to rise slightly after experiencing a sharp decline in November, perhaps due to last weeks better than forecasted inflation data or just good old fashioned holiday cheer.
Markets are calming as volatility returns to more sanguine levels. Momentum amongst most major indexes has softened, which signaling either a market taking a break after this year’s tumultuous rally or a true change in trend. Overall price strength isn’t especially strong, but improvement in breadth has helped provide some support. This has helped lift investor sentiment out of heightened fear of the last few weeks to a more neutral stance.
Newton Model Insights
Our Newton model paints a value driven picture. Healthcare and consumer defensive lead the show, while most other sectors don’t look so hot. Small-caps are leading the way right now, but in an overall tepid equity market. While equities find their footing, bonds continue to produce attractive model scores.
Economic Releases This Week
Monday: None
Tuesday: GDP (Q3 delayed), Durable Goods Orders (October), Consumer Confidence
Wednesday: Initial Jobless Claims
Thursday: Merry Christmas
Friday: None
Stories to Start the Week
From intern to executive leader, the man behind Google’s Gemini AI
Can Americans learn to love tiny, cheap kei cars?
Over 50% of primary mortgage-holders have interest rates of 4% or lower
TikTok signs deal to form U.S. joint venture with majority American ownership
Paramount guarantees Larry Ellison backing in amended WBD bid
Why Does the College Football Playoff Have So Many Boring Blowouts?
Our Newton model attempts to determine the highest probability of future price direction by using advanced algorithmic and high-order mathematical techniques on the current market environment to identify trends in underlying security prices. The Newton model scores securities over multiple time periods on a scale of 0-20 with 0 being the worst and 20 being the best possible score. Trend & level both matter. For example, a name that moves from an 18 to a 16 would signal a strong level yet slight exhaustion in the trend.
Technical trading models are mathematically driven based upon historical data and trends of domestic and foreign market trading activity, including various industry and sector trading statistics within such markets. Technical trading models, through mathematical algorithms, attempt to identify when markets are likely to increase or decrease and identify appropriate entry and exit points. The primary risk of technical trading models is that historical trends and past performance cannot predict future trends and there is no assurance that the mathematical algorithms employed are designed properly, updated with new data, and can accurately predict future market, industry and sector performance.