This week’s defining feature was not “news” — it was the structure of year-end trading: reduced participation, mechanical flows, and markets reacting more to positioning than fundamentals.
Multiple market notes emphasized late-December conditions: thinner books, wider spreads, and bigger price impact. This setup can produce calm sessions and sudden spikes — both are consistent with low depth.
Investor interpretation remains: inflation trajectory → Fed path → yields → equity leadership. That chain matters most because it’s the fastest way to shift risk appetite in crowded exposures.
Santa-season narratives supported sentiment, but positioning constraints can turn “rally season” into a slower grind rather than a chase.
Year-end isn’t the time to overfit signals. The best recap is simple: liquidity + rates dominated. Next week, focus on whether liquidity returns and whether yields stay stable as January begins.
FinTrend analysis: recap emphasizes the dominant cross-source theme: year-end mechanics > fundamentals.