Weekly Market Wrap — Nov 24–28, 2025 (Thanksgiving Week)

Summary Highlights

• US risk assets rallied into Thanksgiving, helped by falling yields and a fresh wave of confidence that the Fed is done hiking.
• Rate-cut expectations swung sharply on dovish Fed rhetoric (Williams/Waller/Daly) and a run of softer US data (incl. cooling activity signals and underwhelming retail tone).
• Cross-asset action carried a classic holiday signature: thin liquidity, bigger headline impact, and position-driven moves.
• Dollar and yields softened while equities pushed higher; commodities were choppy, with oil whipsawed by geopolitics and Russia–Ukraine peace-talk headlines.
• Friday trading was further distorted by a CME outage, halting multiple futures markets and reinforcing the holiday “muted tape.”

Risk markets entered the week with a simple setup: softer US data, lower yields, and a policy narrative gradually rotating from “higher for longer” toward “cut window opening.” Early-week trading leaned into the dovish interpretation. Treasuries caught a bid, the dollar faded, and equities firmed as investors priced a higher probability that the Fed has moved from hiking risk to easing optionality. The tape wasn’t a single-catalyst story—more a steady accumulation of “less restrictive ahead” signals amplified by low liquidity.

Fed communication did its part. Dovish-leaning commentary—especially the idea that policy is only “mildly restrictive” and could justify a near-term cut—kept the front-end anchored and supported duration. That gave equities room to re-rate, with the S&P 500 posting a strong weekly gain (~+3.7%) as the market drifted into the holiday feeling increasingly comfortable with the “Fed is done” base case. This was less about exuberant growth repricing and more about the discount rate: lower yields, higher multiples, better mood.

Cross-asset confirmation was visible: the DXY traded softer within a tight range rather than trending higher, while risk-sensitive FX stabilized. Oil, meanwhile, moved with headlines—periods of downside pressure on peace-talk optimism and geopolitics-based risk-premium repricing, followed by stabilization as flows thinned. The overall feel: “risk-on, but fragile,” with positioning doing as much work as fundamentals.

Thanksgiving itself imposed the usual quiet regime—US cash markets shut, futures subdued, and Europe/Asia carrying modest moves. Then Friday added a mechanical wrinkle: a CME outage temporarily halted trading across segments (including FX, commodities, Treasuries, and equity futures), compressing price discovery and exaggerating the already-muted holiday tape. With liquidity thin and execution constrained, intraday moves were more about microstructure than macro revelation.

Bottom line: this was a policy-and-duration-led risk-on week. Falling yields and rising confidence in a December cut narrative did the heavy lifting, while commodities and FX largely played defense amid headline churn. The key watch for the next full week is whether the “lower yields + easier Fed” setup is validated by incoming data—or whether the market has simply overpaid for calm in a holiday-distorted window.