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“For eleven months and maybe about twenty days each year, we concentrate upon the shortcomings of others, but for a few days at the turn of the New Year we look at our own. It is a good habit.” – Arthur Hays Sulzberger
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
We made it (almost) through another year. Regardless of your political leanings, one thing we can all probably agree on is that with Trump as President, there’s never a dull moment. It was true in his first term, and the first year of his second term has proved no different. For all the uncertainty and volatility this year, though, it’s ironic to think that the VIX is closing out 2025 at under 15 and not far from its lows of the year!
Futures are lower this morning, with the S&P 500 indicated to open 0.21% lower while the Nasdaq is down 0.30%. A decline today would make it four straight days of declines to close out the year. Despite the gains for the year, 2025 is going out with a whimper.
Outside of equities, the 10-year US Treasury yield is down 2 bps to 4.1% while crude oil is fractionally higher. While most areas of the financial markets are quiet today, the real action is in metals, where the CME has lifted margin requirements for the second time in a week! Gold is down 1.6%, while silver is down over 8% and platinum is sinking over 10%. Silver is on pace for its fourth straight day of 7.5% daily moves, while platinum has had four straight 5%+ daily moves.
In Asia overnight, the Nikkei was closed, but most other indices in the region finished the last trading day of the year higher as China’s manufacturing PMI moved slightly back into expansionary territory (50.1) and came in higher than expected. In Europe, the tone is less positive this morning as the STOXX 600 trades down 0.2% in a session where many countries are closed for trading, and those that are open will close early. Technology is leading the losses with a decline of 0.6%.
Equities are on pace to close out the last session of the year with losses, and that’s a trend that has become increasingly common in recent years. The chart below shows the S&P 500’s historical performance on the last trading day of the year since 1953. The S&P 500’s median performance has been a gain of 0.14% with positive returns 58.3% of the time.
While the long-term performance has been positive, more recent returns have been weaker. If the S&P 500 finishes lower today, it would be the fifth straight year that the index traded lower on the last session of the year, and that would be the longest streak since at least 1953. Besides just the last four years, though, the pattern of the last trading day of the year has been lower. Since 2000, the S&P 500’s median change on the last trading day of the year has been a decline of 0.28%, with gains less than a third of the time. If there’s any consolation for bulls, in years when the S&P 500 was up over 15% YTD heading into the final session of the year, the median gain on the final day has been a gain of 0.29%, with gains 64% of the time, while in all other years, the median gain was just 0.5%.
When we turn the calendar to 2026 on Friday, market performance on the first trading day of the year hasn’t been great either. Since 1953, the S&P 500’s median change to start a new year was a decline of 0.3% with gains just under half of the time. The equity market has also traded lower on the first trading day of the year in each of the last three years and four of the last five. Maybe the best idea is to take off until Monday!
