S&P 500 Daily Update for Friday December 5, 2025

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Summary of the Daily Market Update for Thursday, December 4, 2025:
Outlook for Friday, Dec 5, 2025:
Overall Market Tone:
Another very quiet, choppy, range-bound day with almost no conviction.
S&P 500 closed +0.11% on below-average volume after opening higher, dipping into the red, and grinding sideways.
Market is positive on all three timeframes (short, intermediate, long), but still not trending in the intermediate term and only barely starting a possible positive short-term trend.
Key Highlights from Thursday:
Small caps continued to shine: Russell 2000 / IWM hit a new all-time high (S&P 600 small-cap index was slightly lower).
Mega-cap tech was mixed → largely canceled each other out; growth slightly underperformed value again in the short term (defensive tilt showing).
10-year yield rose to 4.11% but had little impact on stocks.
Geopolitical noise and other headlines → ignored by the market.
Important Technical Signals:
Confirmed Hindenburg Omen still in the background (but fading in relevance without new spikes).
Unconfirmed Zweig Breadth Thrust (ZBT) → needs a strong upside day on Friday to confirm (data lags, so we’ll know early next week).
Most breadth, momentum, smart-money, and sentiment indicators remain positive or improving.
Gamma exposure is green across the board → supportive, but overhead resistance around 6,860–6,870.
Economic Data Released Thursday:
Weekly Initial Jobless Claims: 191k (big drop vs 220k expected and prior 218k) → very strong labor market.
Continuing Claims: 1.939M (still under 2M).
Factory Orders: +0.2% (slightly softer).
Trade Balance: deficit continues to narrow slowly.
Friday, December 5 – What Everyone is Watching:
Core PCE (the Fed’s preferred inflation gauge) → the big market-moving report.
Personal Income & Spending, Factory Orders, Consumer Sentiment, Consumer Credit.
Market is almost fully pricing in a Fed rate cut at the December 10 meeting → small caps especially like lower rates.
A hot/in-line PCE could reduce cut odds and pressure risk assets; cooler-than-expected would reinforce the cut and likely spark upside.
Broader Context & Seasonality:
Market remains in a “no-trend/choppy” phase but internals are generally healthy.
December seasonality is strongly positive (especially second half), and year-1 of presidential cycle has been up 90% of the time since 1985 with avg +1.9%.
Market-neutral option strategies are favored (theta decay) in this low-conviction environment.
Bias: Positive on all timeframes
Momentum: Mixed-to-positive (held back by lack of trend and short-term growth-underperformance).
Outlook for Friday: Needs either a strong catalyst (favorable PCE) to break the chop to the upside, or continued sideways action if the data is mixed/ignored.
Conclusion:
The S&P 500 is holding up well, breadth and sentiment are improving, small caps and value are showing relative strength, but the tape remains trendless and awaiting Friday’s Core PCE for the next directional cue.

PDF of Slides:
https://drive.google.com/file/d/1TdaHezvoFuhVVTY9ouj8VY_oBkdC5A2g/view?usp=sharing

DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!