Market Snapshot
| Dow | 48057.54 | +497.46 | (1.05%) | | Nasdaq | 23654.19 | +77.67 | (0.33%) | | SP 500 | 6886.67 | +46.17 | (0.67%) | | 10-yr Note |
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| | NYSE | Adv 1981 | Dec 750 | Vol 1.45 bln | | Nasdaq | Adv 3099 | Dec 1609 | Vol 8.05 bln |
Industry Watch
| Strong: Industrials, Consumer Discretionary, Health Care, Materials, Financials |
| | Weak: Utilities |
Moving the Market
--FOMC delivers a 25-basis point rate cut at December FOMC meeting
--Summary of Economic Projections (SEP) shows median estimate of one rate cut in 2026, unchanged from September
--Weakness in tech names preventing index-level growth
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FOMC delivers rate cut, optimistic outlook lifts stocks
10-Dec-25 16:25 ET
Dow +497.46 at 48057.54, Nasdaq +77.67 at 23654.19, S&P +46.17 at 6886.67
[BRIEFING.COM] The stock market captured solid broad-based gains this afternoon following the FOMC's decision to reduce the federal funds rate by 25 basis points, snapping a streak of muted sessions and moving the S&P 500 (+0.7%), Nasdaq Composite (+0.3%), and DJIA (+1.1%) within close proximity of their all-time highs. The Russell 2000 (+1.3%) captured record highs of its own as small-cap stocks, with their increased domestic presence and sensitivity to borrowing costs, surged in reaction to the FOMC decision.
The market was largely expecting the FOMC to deliver a "hawkish cut" at today's meeting, meaning that a rate reduction was anticipated alongside commentary that would dampen expectations of further easing.
Indeed, the Summary of Economic Projections (SEP) showed a median expectation of just one rate cut in 2026, unchanged from the September SEP. However, the SEP also showed an upward revision in the median estimate for the change in real GDP to 2.3% from 1.8%. Meanwhile, the median estimate for the unemployment rate held steady at 4.4%, as the outlook for PCE inflation was revised down to 2.4% from 2.6%.
While the FOMC may now embrace a "wait-and-see" approach, as noted by Fed Chair Powell's comment, "the Fed funds rate is now within a broad range of estimates of its neutral value," optimistic revisions to the economic outlook, in tandem with an expressed willingness to make policy decisions on a meeting-by-meeting basis, invite questions as to just how hawkish today's meeting truly was.
Today's decision also featured an announcement that the Fed will begin purchasing Treasury bills, starting December 12, to the tune of $40 billion per month before likely being "significantly reduced" after a few months, noting that reserve balances have declined to ample levels.
The stock market certainly benefitted from the more dovish than expected tilt, with the major averages capturing solid gains after a morning spent in a mixed fashion near their unchanged levels.
Nine S&P 500 sectors finished higher, with six notching gains of 1.0% or wider. A smattering of corporate news items contributed strength to several of the top-performing sectors.
The industrials sector (+1.8%) finished at the top of the leaderboard, supported by shares of GE Vernova (GEV 722.97, +97.67, +15.62%) rallying after the company issued upbeat guidance and provided an optimistic long-term financial outlook.
The consumer discretionary sector (+1.5%) was another top mover, garnering the bulk of today's mega-cap strength due to solid gains in Amazon (AMZN 231.78, +3.86, +1.69%) and Tesla (TSLA 451.44, +6.27, +1.41%).
Homebuilder names, which are sensitive to borrowing costs, added support, with the iShares U.S. Home Construction ETF gaining 3.2% today.
Banking names lifted the financials sector (+1.1%) to a nice gain, with JPMorgan Chase (JPM 310.17, +9.66, +3.21%) mounting a solid rebound from yesterday's 4.6% slide.
Elsewhere, the materials (+1.8%), health care (+1.5%), and energy (+1.1%) sectors round out today's top performers.
While losses in Microsoft (MSFT 478.76, -13.26, -2.70%) and NVIDIA (NVDA 183.74, -1.23, -0.66%) limited gains in the information technology sector (+0.1%), solid participation across a majority of its components helped the sector recover from a loss of nearly 1.0% this morning. Oracle (ORCL 223.30, +1.78, +0.80%) ended with a modest gain ahead of its earnings release this afternoon despite spending the bulk of the session in negative territory.
Only the defensive utilities (-0.1%) and consumer staples (flat) sectors failed to notch a gain today.
All told, today's FOMC decision delivered on the promise of a rate cut, while Fed Chair Powell's emphasis on a meeting-by-meeting approach and his comment that a rate hike is not in anyone's base case conveyed a surprisingly dovish tone that helped lift risk sentiment and support solid growth across stocks today. Still, investors will have plenty to monitor on the policy front going forward, as today's decision featured two dissenters (Chicago Fed President Austan Goolsbee and Kansas City Fed President Jeffrey Schmid), while a new Fed Chair, likely one with an initiative to lower interest rates, will take the helm in May.
U.S. Treasuries climbed on Wednesday, snapping a four-day skid in the 10-year note and shorter tenors. The 2-year note yield settled down four basis points to 3.57%, and the 10-year note yield settled down two basis points to 4.16%
- Nasdaq Composite: +22.5% YTD
- S&P 500: +17.1% YTD
- Russell 2000: +14.8% YTD
- DJIA: +13.0% YTD
- S&P Mid Cap 400: +7.7% YTD
Reviewing today's data:
- Compensation costs for civilian workers increased 0.8% (Briefing.com consensus: 0.9%), seasonally adjusted, for the 3-month period ending in September 2025. That was a moderation from the 0.9% increase registered in the second quarter.
- The key takeaway from the report is that it was an inflation-friendly report, evidenced by wages and salaries decelerating on a year-over-year basis for civilian workers (3.5% vs 3.9% a year ago), private industry (3.6% vs 3.8% a year ago), and state and local government workers (3.5% vs 4.6% a year ago).
- The U.S. Treasury reported a $173.0 bln deficit for November (Briefing.com consensus -$223.4 bln) after a deficit of $284.0 bln in October.
- The weekly MBA Mortgage Index rose 4.8% to follow last week's 1.4% decrease. The Refinance Index jumped 14.3% while the Purchase Index was down 2.4%.
Small-caps and homebuilders surge following FOMC decision
10-Dec-25 15:30 ET
Dow +568.11 at 48128.19, Nasdaq +100.21 at 23676.73, S&P +51.01 at 6891.51
[BRIEFING.COM] The S&P 500 (+0.8%), Nasdaq Composite (+0.5%), and DJIA (+1.2%) are charting session highs just before the close as investors react to the outcome of today's FOMC decision.
The small-cap Russell 2000 (+1.7%) surged higher in response to the decision to cut the federal funds rate by 25 basis points.
In addition to small-cap names, homebuilder stocks are also sensitive to borrowing costs and have seen a nice move higher this afternoon. The iShares U.S. Homebuilders ETF holds a 3.3% gain, though significant losses in recent sessions keep it in modestly negative territory for the week.
All told, today's FOMC happenings gave a nice boost to the stock market that has the major averages in modestly positive territory for the week after entering the session with modest losses.
Major averages at session highs amid Fed Chair Powell's press conference
10-Dec-25 14:55 ET
Dow +506.21 at 48066.29, Nasdaq +74.75 at 23651.27, S&P +46.12 at 6886.62
[BRIEFING.COM] The S&P 500 (+0.6%), Nasdaq Composite (+0.3%), and DJIA (+1.0%) are in the midst of some choppy action, currently sitting at session highs as investors react to Fed Chair Jerome Powell's comments at the press conference portion of today's FOMC meeting.
Mr. Powell's comments fulfilled the market's expectations that today's rate cut would come with a hawkish tilt. In particular, the statement "I would note having reduced our policy rate by 75 basis points since September, and 175 basis points since last September, the Fed funds rate is now within a broad range of estimates of its neutral value, and we are positioned to wait and see how the economy evolves" echoes the sentiment that the FOMC will not be quick to provide additional easing in the near term.
While the median estimate for the change in real GDP was revised up to 2.3% from 1.8%, the median estimate for the unemployment rate held steady at 4.4%, and the outlook for PCE inflation was revised down to 2.4% from 2.6%, the Summary of Economic Projections still shows a median estimate of just one rate cut in 2026, unchanged from September.
Still, the major averages are noticeably improved from their pre-meeting levels, with each index now sitting above its unchanged week-to-date level.
Fed Cuts Rates 25 bps; Mixed Vote and New T-Bill Purchases Lift Stocks Ahead of Powell Remarks
10-Dec-25 14:30 ET
Dow +248.69 at 47808.77, Nasdaq -50.68 at 23525.84, S&P +12.45 at 6852.95
[BRIEFING.COM] As expected, the FOMC voted to cut the target range for the fed funds rate by 25 basis points to 3.50-3.75%. That vote was not unanimous (also expected). It was 9-to-3, with Fed Governor Miran dissenting in favor of a larger 50-basis-point cut and Chicago Fed President Goolsbee and Kansas City Fed President Schmid preferring no change.
The directive noted that downside risks to employment rose in recent months and that inflation has moved up since earlier in the year and remains elevated.
The Summary of Economic Projections (SEP) showed a median estimate of one rate cut in 2026, unchanged from the September SEP. The median estimate for the change in real GDP was revised up to 2.3% from 1.8%; meanwhile, the median estimate for the unemployment rate held steady at 4.4%, as the outlook for PCE inflation was revised down to 2.4% from 2.6%. The longer-run neutral rate remained at 3.0%.
Today's decision also featured an announcement that the Fed will begin purchasing Treasury bills, starting December 12, to the tune of $40 billion per month before likely being "significantly reduced" after a few months, noting that reserve balances have declined to ample levels.
The initial reaction to the Fed's update has been positive but somewhat measured ahead of Fed Chair Powell's press conference. The purchase of Treasury bills and sticking with a median estimate of one rate cut for 2026, while clearly not expecting any economic slowdown or any pickup in inflation, have been placating influences for a market braced for a rejoinder that there might not be another rate cut for an extended period.
Perhaps Fed Chair Powell will deliver that message, but for now, the market looks content that the message so far about the forward view isn't decidedly hawkish-minded.
The Russell 2000 is up 0.8%, the Dow Jones Industrial Average is up 0.5%, the S&P 500 is up 0.2%, and the Nasdaq Composite is down 0.2%.
Gold Slips Ahead of Fed Decision as Profit-Taking and Firmer Yields Pressure Bullion
10-Dec-25 13:55 ET
Dow +153.03 at 47713.11, Nasdaq -96.42 at 23480.10, S&P -2.34 at 6838.16
[BRIEFING.COM] The tech-heavy Nasdaq Composite (-0.41%) is in last place as we approach two hours left on the session; looking ahead to the top of the hour the FOMC will announce its latest policy decision and the Treasury is slated to release its monthly budget report.
Gold futures settled $11.50 lower (-0.3%) at $4,224.70/oz, as traders took profits and positioned cautiously ahead of the Fed meeting, with firmer Treasury yields briefly denting demand for non-yielding assets. Momentum in other metals, particularly silver, also drew some attention away from bullion, keeping gold on the back foot.
Meanwhile, the U.S. Dollar Index is down about -0.3% to $98.97.
AeroVironment's top-line surge thwarted by margin collapse as BlueHalo acquisition weighs (AVAV)
AeroVironment (AVAV) is plunging lower following its 2Q26 report as investors look past spectacular top-line growth and focus instead on a sharp EPS miss, a dramatic gross margin reset, and a lower-than-expected FY26 outlook. While management highlighted record awards, bookings, and strong multiyear demand signals, the mix and margin dynamics tied to the BlueHalo acquisition, and a heavier services footprint materially changed the earnings profile versus what the market was expecting.
- Revenue surged 151% yr/yr to $472.5 mln, comfortably ahead of expectations, driven by the inclusion of BlueHalo and 21% organic growth from legacy AVAV.
- Gross margin was the key negative surprise, collapsing to 22% (27% adjusted) from roughly 39–41% a year ago.
- The margin compression was driven primarily by a higher mix of lower-margin service revenue, increased amortization and other non-cash purchase accounting expenses from BlueHalo, one-time operational inefficiencies tied to the Oracle Fusion ERP go-live and the U.S. government shutdown.
- Autonomous Systems revenue was $301.6 mln, led by 38% growth in Precision Strike and Counter-UAS (Switchblade 600, Titan) and strong JUMP 20 growth.
- Cyber and Directed Energy delivered revenue of $170.9 mln with 20%+ growth in Space and Directed Energy (LOCUST, laser comms) offset by weakness in Cyber and Mission Systems due to program discontinuations and shutdown impacts.
- Bookings were a standout at nearly $1.4 bln, supported by $3.5 bln of total contract awards, with funded backlog at $1.1 bln and unfunded at $1.8 bln, equating to 93% “visibility” to the revenue guidance midpoint once expected funding is included.
- AVAV still expects adjusted gross margin to improve through the year, targeting the high-30s by Q4 and low-30s for FY26 overall.
- FY26 EPS guidance was cut to $3.40–3.55, with the reduction driven mainly by a higher projected tax rate after the updated BlueHalo purchase price allocation, layered on top of mix-driven margin pressure.
- AVAV raised the low end of its revenue guidance to $1.95–2.00 bln (about 15% growth vs. pro forma FY25).
Briefing.com Analyst Insight
AVAV’s 2Q26 print underscores a classic growth-vs-profitability tug-of-war. The company is winning major programs and building a powerful, multi-domain defense tech platform, but the BlueHalo-driven mix shift and tax headwinds have reset the near-term EPS algorithm. The combination of a 17-point gross margin compression, lower EPS guidance, and a heavily back-weighted 4Q earnings ramp is overshadowing the record bookings and robust demand narrative, prompting a sharp reset in the stock after a strong run into the print. Even so, record awards, strong visibility, and expanding sole-source and multiyear positions in loitering munitions, counter-UAS, space, and directed energy suggest the long-term growth story remains intact if management can execute against the back-half ramp and deliver on the promised margin recovery.
Casey's General Delivers Solid Q2, but Inside Comp Guidance Tempers Enthusiasm (CASY)
Casey's General (CASY) is trading modestly lower after reporting its Q2 (Oct) results last night. The company comfortably beat EPS expectations, extending its streak of large double-digit upside, while revenue increased 14.2% yr/yr to $4.51 bln, an acceleration from Q1, but was just in line with expectations. Casey's also raised its FY26 EBITDA growth target to +15-17% from +10-12% and tightened its inside same-store sales outlook to +3-4% from +2-5%, effectively reaffirming the midpoint.
- Inside same-store sales increased +3.3% (+4.3% in Q1), underpinned by an increase in guest traffic as customers responded to CASY's value proposition.
- This was driven by a +4.8% (+5.6% in Q1) inside comp in the prepared food & dispensed beverages segment, while Grocery & General Merchandise inside comp came in at +2.7% (+3.8% in Q1).
- Inside margin improved 20 bps to 42.4%, with prepared food at 58.6% (+60 bps) and grocery at 36% (+10 bps).
- Fuel performance was impressive, marking its fourth consecutive quarter of fuel gallon growth, with same-store gallons up +0.8% and fuel margin expanding to about $0.416 per gallon from $0.410.
- Management described consumer sentiment as cautious but behavior as healthy, noting that guests intend to maintain visit frequency and that traffic and same-store sales remain solid as value-conscious customers increasingly choose Casey's prepared food over higher-priced QSR options.
Briefing.com Analyst Insight
This was another strong quarter for CASY. Inside comps were a bit softer than Q1 but still healthy, showing customers are still responding to Casey's value proposition. Additionally, top-line growth accelerated, margins moved higher in key high-margin categories, and fuel once again delivered both gallon growth and higher cents-per-gallon in a tougher backdrop. While CASY did raise FY26 EBITDA guidance to 15-17%, we think investors may be reacting to the inside comp guidance, which was narrowed to +3-4% and effectively reaffirmed the midpoint rather than pushing expectations higher. Given the strong run in the stock and strong performance in the first half, some investors may have been looking for more aggressive upside. Even so, we think the increased traffic and still positive comps support the idea that its customer remains in decent shape and that the underlying business is holding up well, even if the guidance tweak was more measured than some might have hoped.
Chewy Fetches Strong Q3 Results as Autoship Growth Keeps the Stock Purring (CHWY)
Chewy (CHWY) is chewing up some nice gains after delivering a hefty Q3 (Oct) EPS beat and issuing Q4 (Jan) EPS guidance well above consensus. Revenue of $3.12 bln (+8.1% yr/yr) was in line, but the quality of growth impressed as Chewy continued to outperform the broader pet category and expand market share. The results extend the momentum seen in 1H25, underscoring the structural resilience of Chewy's model despite a choppy macro backdrop.
- Revenue growth driven by unit volume, not price, a sign of healthy underlying demand. Active customers: 21.2 mln, up nearly 5% yr/yr, supported by improved marketing efficiency and higher conversion.
- Autoship sales +13.6% yr/yr to $2.61 bln, outpacing total company growth. Autoship remains a major engine for predictability, cost efficiency, and margin expansion.
- Mobile app strength: App customers and app orders both +15% yr/yr, helped by enhanced app functionality and increasing direct traffic.
- Chewy Vet Care continues to surpass expectations, driving high utilization and deepening customer loyalty through recurring, high-margin services. Clinics double as acquisition channels and retention drivers, increasing Autoship and pet health program engagement. SmartEquine acquisition boosts Chewy's premium veterinary, health, and nutraceutical offerings, expanding reach into higher-value verticals.
Briefing.com Analyst Insight
Chewy's Q3 report checks nearly every box investors wanted to see: clean volume-driven growth, strong Autoship momentum, sustained active customer gains, and expanding services-driven engagement. The flywheel of Autoship, Vet Care, and Chewy+ is becoming more apparent, improving both visibility and margin potential. Still, we remain mindful that Chewy is navigating a pet category that has slowed from its pandemic highs. The company is outperforming peers, but the broader backdrop is far from robust.
Execution is strong but sustaining mid-single-digit to high-single-digit growth in a pressured category will require continued customer acquisition efficiency and disciplined cost management. From a valuation perspective, Chewy offers an improving story, but we're not ready to call it a high-conviction momentum name until macro pressure in the pet category eases. For now, we view CHWY as a steady share-gainer with tightening fundamentals, but not necessarily a stock to chase aggressively after big earnings-day pops.
GE Vernova hits all-time highs on robust outlook, fueled by surge in AI-driven power demand (GEV)
GE Vernova (GEV) is hitting fresh record highs after the company reaffirmed its FY25 revenue outlook, issued in-line FY26 guidance, provided long-term financial projections, and significantly boosted capital returns with a doubled quarterly dividend to $0.50/share and a $10 bln buyback authorization. The company sees its equipment and services backlog reaching $200 bln by 2028, fueled by surging U.S. electricity demand from data centers, AI compute growth, and widescale electrification across industry and transportation.
- Backlog growth is anchored by grid modernization, nuclear and renewables expansion, and gas capacity to balance intermittent renewable output.
- Rising free cash flow expectations are supporting a shareholder-friendly capital allocation framework, reflected in the doubled dividend and $10 bln repurchase authorization.
- Heavy investment in AI, robotics, and automation aims to improve factory throughput and reduce cost intensity, positioning margins structurally higher over time.
- GEV expects profitable Gas Power services to ramp meaningfully in the 2030s, providing a recurring revenue foundation less sensitive to equipment cycles.
- Rewinding to Q3 (reported on Oct. 22), EPS missed and free cash flow declined due to higher capex, but the 55% surge in total orders and electrification growth of over 100% underscored powerful end-market demand.
- GEV's long-term guidance range suggests confidence that it can compound earnings by servicing the massive wave of electricity demand growth tied to AI and industrial electrification.
Briefing.com Analyst Insight:
GEV is looking like one of the most compelling large-cap energy transition plays thanks to accelerating secular demand for electricity, a rapidly swelling backlog, and a clearer roadmap to recurring service revenue later in the decade. The company’s long-term targets lean bullish, but they’re grounded by hard data -- hyperscale data centers, EV charging infrastructure, and grid upgrades are not hypothetical demand drivers, they are already materializing in purchase orders today. The valuation is less forgiving after today’s breakout to all-time highs (1-year forward P/E of 50x), yet investors appear comfortable paying a premium for backlog visibility, cash flow scaling, and a sharply more shareholder-friendly capital return program. Execution will matter, especially around cost efficiency, capex discipline, and scaling automation, but the multiyear runway looks real. If GEV maintains order momentum while turning Q3’s investment spending into higher free cash flow, the stock could have even more room to run.
AutoZone Slips on Sixth Straight EPS Miss, Though Several Tailwinds Remain In Place (AZO)
AutoZone (AZO) is heading lower after reporting its Q1 (Nov) results this morning. The company missed EPS expectations, which declined 4.6% to $31.04 and now marks six consecutive quarters of falling short of estimates. Revenue increased 8.2% yr/yr to $4.63 bln, which was just in line with expectations.
- The EPS miss was largely driven by another non-cash LIFO charge of $98 mln tied to higher costs and tariffs. This pressured gross margin, which declined 203 bps to 51%, of which 212 bps came from the LIFO charge, partially offset by underlying merchandise margin improvements.
- Company-wide comp sales increased +4.7% in CC (+5.1% in Q4), with domestic comps +4.8% (+4.8% in Q4) and international comps +3.7% in CC (+7.2% in Q4).
- In the U.S., commercial sales continue to accelerate, increasing 14.5% yr/yr and building on the momentum seen since Q2 FY25. Domestic DIY comps slowed to +1.5% from +2.2% in Q4, which management primarily attributed to less favorable weather.
- Internationally, while management noted it continues to gain share, the slowdown in comps was tied to softer economic growth, particularly in Mexico, though it remains committed to accelerating store openings and sees international as a meaningful long-term growth driver.
- Growth remains underpinned by an accelerated store opening pace and ongoing investments in hubs and mega hubs, which are growing faster than the balance of the chain and enhancing parts availability and delivery speed.
- Additionally, management still sees tailwinds for the remainder of FY26 from its growth initiatives and favorable macro car-park dynamics (an aging vehicle fleet and a tougher new/used car market).
Briefing.com Analyst Insight
AZO's Q1 tells a familiar two-sided story. It delivered solid top-line growth and healthy comps which, while a bit lower than last quarter, were still respectable. On the other side, another EPS miss, driven by a sizable $98 mln LIFO charge and higher growth-related expenses, extends a now-lengthy streak of falling short of estimates and keeps a cloud over margin visibility, even if LIFO remains more of an accounting and cost-timing headwind than a structural issue. At the same time, underlying trends are still encouraging, with accelerating commercial growth, positive DIY and international comps, and several tailwinds, including supportive car-park dynamics, new hubs and mega hubs, and international expansion, that could all serve as meaningful growth levers once LIFO pressures and elevated spending ease.
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