Wall Street’s quiet Thanksgiving hides a louder story
The screens are dark on Wall Street today, yet the real story is still unfolding in the background. Markets may be closed for Thanksgiving, but the mood that carried traders into the break was anything but sleepy: four straight days of gains, renewed enthusiasm for artificial intelligence plays, and a growing conviction that the Federal Reserve will finally blink and cut rates in December. As the New York Stock Exchange and Nasdaq sit shut and investors carve turkey instead of charts, positioning for the rest of the year is already well under way.
From sell-off nerves to holiday cheer
Only a week ago, November looked like a month that might end on a sour note, with the S&P 500 and Nasdaq nursing losses after a wobble in high‑growth, AI‑linked names. Then the narrative flipped: softer data, falling yields and a sense that the Fed had done enough tightening pulled buyers back in, turning a tentative bounce into the best four‑day stretch since May.
US indices closed Wednesday firmly higher, with all three major benchmarks extending their winning streak as traders leant into the idea of a year‑end “Santa rally.” Paul Stanley, chief investment officer at Granite Bay Wealth Management, summed up the mood: markets are “celebrating the likelihood of a December rate cut,” seeing it as protection against a cooling jobs market rather than a sign of impending recession. In other words, investors are trying to grab the sweet spot where growth slows just enough to tame inflation, but not enough to spoil earnings season.
Behind the scenes, rate expectations have shifted quickly. CME FedWatch-derived pricing now implies odds north of 80% for a quarter‑point cut next month, up sharply from around 30% only a week earlier, as labour data softened and inflation trends stayed benign. George Boubouras of K2 Asset Management argues there is now “sufficient weakness in the labour market” to justify easing, framing a December cut as plausible rather than heroic. That combination of policy support and the prospect of cheaper money has powered tech, rate‑sensitive sectors and the AI trade back into favour.
What a closed market is really telling investors
Thanksgiving itself acts almost like a pause button, but not a reset. Cash trading in New York is frozen, yet futures are edging higher and global equities in Asia and Europe are taking their cue from the US rally, encouraged by the same Fed narrative. With Wall Street shut today and scheduled for a shortened session tomorrow, much of the positioning for the holiday week has already been done; what happens next hinges on whether data between now and the December meeting supports the “gentle landing” story.
Some strategists warn that markets may be leaning too hard on central‑bank generosity. John Authers notes that faith in a Fed backstop – the old “Greenspan put” in modern form – has once again overridden fears of a deeper correction, as traders revert to buying dips whenever policy looks set to ease. Others take a longer view: Doug Beath at Wells Fargo Investment Institute argues that the real message is not about one meeting, but about the direction of travel, with short‑term rates likely trending lower through 2026, which “is positive for equity markets” even if December itself disappoints.
For now, with turkey on the table and trading screens dimmed, US stocks head into the long weekend with momentum, not anxiety. History suggests Thanksgiving week often outperforms the rest of the year, and 2025 so far has followed that script, with both the S&P 500 and Nasdaq up solidly year‑to‑date and beating long‑run averages. When the bell rings for that shortened Friday session, traders will not just be returning from a break; they will be stepping back into a market that has quietly decided it wants a rate cut – and has already started to price in what happens if it gets one.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
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The screens are dark on Wall Street today, yet the real story is still unfolding in the background. Markets may be closed for Thanksgiving, but the mood that carried traders into the break was anything but sleepy: four straight days of gains, renewed enthusiasm for artificial intelligence plays, and a growing conviction that the Federal Reserve will finally blink and cut rates in December. As the New York Stock Exchange and Nasdaq sit shut and investors carve turkey instead of charts, positioning for the rest of the year is already well under way.
From sell-off nerves to holiday cheer
Only a week ago, November looked like a month that might end on a sour note, with the S&P 500 and Nasdaq nursing losses after a wobble in high‑growth, AI‑linked names. Then the narrative flipped: softer data, falling yields and a sense that the Fed had done enough tightening pulled buyers back in, turning a tentative bounce into the best four‑day stretch since May.
US indices closed Wednesday firmly higher, with all three major benchmarks extending their winning streak as traders leant into the idea of a year‑end “Santa rally.” Paul Stanley, chief investment officer at Granite Bay Wealth Management, summed up the mood: markets are “celebrating the likelihood of a December rate cut,” seeing it as protection against a cooling jobs market rather than a sign of impending recession. In other words, investors are trying to grab the sweet spot where growth slows just enough to tame inflation, but not enough to spoil earnings season.
Behind the scenes, rate expectations have shifted quickly. CME FedWatch-derived pricing now implies odds north of 80% for a quarter‑point cut next month, up sharply from around 30% only a week earlier, as labour data softened and inflation trends stayed benign. George Boubouras of K2 Asset Management argues there is now “sufficient weakness in the labour market” to justify easing, framing a December cut as plausible rather than heroic. That combination of policy support and the prospect of cheaper money has powered tech, rate‑sensitive sectors and the AI trade back into favour.
What a closed market is really telling investors
Thanksgiving itself acts almost like a pause button, but not a reset. Cash trading in New York is frozen, yet futures are edging higher and global equities in Asia and Europe are taking their cue from the US rally, encouraged by the same Fed narrative. With Wall Street shut today and scheduled for a shortened session tomorrow, much of the positioning for the holiday week has already been done; what happens next hinges on whether data between now and the December meeting supports the “gentle landing” story.
Some strategists warn that markets may be leaning too hard on central‑bank generosity. John Authers notes that faith in a Fed backstop – the old “Greenspan put” in modern form – has once again overridden fears of a deeper correction, as traders revert to buying dips whenever policy looks set to ease. Others take a longer view: Doug Beath at Wells Fargo Investment Institute argues that the real message is not about one meeting, but about the direction of travel, with short‑term rates likely trending lower through 2026, which “is positive for equity markets” even if December itself disappoints.
For now, with turkey on the table and trading screens dimmed, US stocks head into the long weekend with momentum, not anxiety. History suggests Thanksgiving week often outperforms the rest of the year, and 2025 so far has followed that script, with both the S&P 500 and Nasdaq up solidly year‑to‑date and beating long‑run averages. When the bell rings for that shortened Friday session, traders will not just be returning from a break; they will be stepping back into a market that has quietly decided it wants a rate cut – and has already started to price in what happens if it gets one.
Disclaimer: The views and recommendations made above are those of individual analysts or brokerage companies, and not of Winvesta. We advise investors to check with certified experts before making any investment decisions.
Ready to earn on every trade?
Invest in 11,000+ US stocks & ETFs