Wall Street Dips Back Into the Red as Investors Await Key Economic Data
- What's Moving the Markets Today?
- Fed Watch: Leadership Speculation and Policy Outlook
- Corporate Spotlight: Tech and AI Developments
- This Week's Economic Calendar
- Analyst Perspectives
- Earnings Watch
Wall Street stumbled again on Monday, extending last week's correction as traders brace for a flood of economic indicators. The tech sector took the hardest hits last week, with Oracle and Broadcom leading the declines. Market sentiment remains shaky - the S&P 500 dropped 0.12% to 6,819 points, the Dow Jones slipped 0.09% to 48,415, and the Nasdaq fell 0.28% to 23,133. Commodities showed mixed movement with WTI crude dipping 1% to $56.6/barrel while Gold gained 0.5% to $4,323/ounce. The dollar index weakened 0.2% against major currencies.
What's Moving the Markets Today?
The December 2025 Empire State Manufacturing Survey shocked markets by plunging to -3.9 versus +10 consensus, signaling contraction in the New York region. Meanwhile, the NAHB/Wells Fargo Housing Market Index held steady at 39, matching expectations. All eyes now turn to Tuesday's jobs report, with economists forecasting 40,000 new nonfarm payrolls and a 4.5% unemployment rate.
Fed Watch: Leadership Speculation and Policy Outlook
The Fed chair succession drama continues as TRUMP floated both Kevin Hassett and Kevin Warsh as potential replacements for Jerome Powell. "We'll soon have a great Fed chair who wants to see lower interest rates," Trump declared. Current CME FedWatch odds show just 24.4% probability of another rate cut at the January 2026 meeting following last week's 25bps reduction to 3.50-3.75%.
Corporate Spotlight: Tech and AI Developments
Oracle (-4.1%) secured $150B in new data center lease commitments last quarter, bringing total AI/cloud commitments to $248B. Alphabet (-0.7%) stands to book substantial gains from its SpaceX stake after the company's $800B valuation in its latest funding round. Meanwhile, iRobot collapsed 72.7% after filing Chapter 11 bankruptcy, with Chinese manufacturer Picea Robotics set to acquire the Roomba maker.
In AI hardware news, OpenAI CFO Sarah Friar confirmed development continues on proprietary hardware following their $6.5B acquisition of Jony Ive's design firm. Nvidia (+0.8%) unveiled its new Nemotron 3 AI model family, claiming significant improvements over previous versions.
This Week's Economic Calendar
Tuesday brings November jobs data, housing starts, and retail sales. Wednesday features industrial production and Atlanta Fed's business expectations. Thursday's highlights include CPI inflation and Philly Fed manufacturing. Friday's "Quadruple Witching" derivatives expiration could spike volatility, compounded by personal income/spending and Michigan consumer sentiment data.
Analyst Perspectives
Citigroup set a bold 7,700 target for the S&P 500 next year, betting on strong corporate earnings and AI investment tailwinds. Morgan Stanley's Michael Wilson suggests modestly weak employment data could actually boost stocks by reinforcing rate cut expectations.
Earnings Watch
Key reports this week include Lennar (Tuesday), Micron and General Mills (Wednesday), Nike and FedEx (Thursday), with Paychex and Carnival closing out Friday. Palantir (+0.4%) secured a three-year renewal of its contract with France's DGSI intelligence service.
