The Week Ahead: Markets Turn to Fed Minutes as Investors Close Out 2025

• S&P 500 gained nearly 18% in 2025, Nasdaq rose 22%, and Dow climbed 14.5% - its best year since 2021, driven by AI-led tech strength
• Fed minutes on Tuesday will be scrutinized for policymaker divisions on December's rate cut, with markets pricing in two 25bp cuts for 2026
• Technical indicators remain bullish with indices above rising 52-week SMAs, though light volume could amplify volatility in year-end trading

Market Summary: Year-End 2025 Trading Week

U.S. equity futures traded slightly lower Monday as markets wrapped up a strong 2025. The S&P 500 ended the year up nearly 18%, reaching an intraday record of 6,945.77, while the Nasdaq Composite surged 22% and the Dow Jones Industrial Average gained 14.5% - its best performance since 2021. AI-driven technology sector strength powered the rally, with leaders like Nvidia, Micron, and Oracle pulling back in premarket after substantial weekly gains.

Key Focus: Federal Reserve Minutes

Tuesday's release of December FOMC meeting minutes takes center stage this week. Markets are pricing in two 25 basis point rate cuts for 2026, potentially starting in March. Traders will scrutinize the minutes for insights into policymaker divisions on the December cut and future easing conditions.

Economic Calendar Highlights:

• Monday: Pending Home Sales (forecast +1.0%)
• Tuesday: FOMC Minutes (19:00 GMT), Chicago PMI (forecast 39.6)
• Wednesday: Unemployment Claims (forecast 215K)
• Thursday: Bank Holiday - no releases
• Friday: Final Manufacturing PMI (forecast 51.8)

Technical Outlook:

All major indices remain above rising 52-week simple moving averages, confirming intact uptrends:

• Dow Jones: 48,710.98, resistance at 48,886.86
• Nasdaq: 23,593.10, resistance at 24,019.99
• S&P 500: 6,929.94, resistance at 6,945.77

Trading volume is expected to remain light during the traditional "Santa Claus rally" period - the final five sessions of the year plus the first two of January, which historically averages over 1% gains for the S&P 500. Market momentum remains constructive heading into 2026, though short-term consolidation near record highs appears likely.