MARKETS week ahead: December 2 – 8Last week in the news
Regardless of a Thanksgiving Holiday in the US during the previous week, markets ended November with a positive sentiment. The US equity market ended its one of best months in the year, with the S & P 500 reaching its new all-time highest level at 6.040. Decreased geopolitical risks and strengthening of US Dollar, impact the price of gold to slow down a bit during the week, ending it around $2,670 level. In expectation of further Fed's rate cuts, the 10Y US Treasury yields dropped to the level of 4,17%. The crypto market remained with a positive post-election sentiment, where BTC tried for one more time to break the $100K level.
From the US macro perspective, there were two major events during the previous week, which impact market sentiment prior to Holidays. Fed's favorite inflation gauge was released, as well as FOMC Minutes from their November's meeting. The PCE data were in line with market expectations. The PCE price Index increased by 0,2% in November, reaching the yearly level of 2,3%. Core PCE remained smoothly elevated at the level of 0,3% for the month. At the same time, Personal Income was higher by 0,6% for the month, while Personal Spending was up by 0,4% for the month. The FOMC meeting minutes revealed conclusions of Feds members at their November meeting that if inflation continues further to slow down and if labour data continue to move in line with their expectations, this would be a solid case for further rate decrease. Current odds for 25 bps interest rate cuts stands at 66%, as per CME FedWatch Tool.
Another event that was closely watched by investors during the previous week is a shopping-holiday popularly called the Black Friday. First estimations showed that the spending of US customers climbed by 3,4% on a yearly basis. This year total e-commerce sales over the internet increased by an incredible 14,3% year-over-year, which shows a clear change of customer habits for incline purchase instead of shopping in stores.
Analysts from Morgan Stanley gave their projection of equities in China for the year 2025. As per their analysis, China can expect a relatively volatile equity market, with major threats mentioned “earnings pressure, geopolitical risks and potential tariffs”. At the same time, analysts see that exports will hold, due to competitive pricing, however, the housing market is expected to stay under pressure.
In an interview with CNBC, a VettaFi representative said that the next year belongs to small cap companies, in which sense, a small-cap index Russel 2000 could benefit the most. The environment of lower interest rates would be beneficial for further growth of these companies. Such sentiment started from November, where the index Russel 2000 gained 11%, and total 35% during the course of this year.
Crypto market cap
Although BTC was the star of the crypto market in the after-election period, still, the previous week belongs to altcoins, since now they are the ones to drive the total crypto market capitalization to the upside. Total crypto market capitalization increased by 2% on a weekly basis, where mostly altcoins managed to add some $70B. At the same time, daily trading volumes remained elevated, around $320B on a daily basis, modestly decreased from $412B traded two weeks ago. Total crypto market capitalization increase from the end of the previous year currently stands at $1.712B, which represents a 105% surge from the beginning of this year.
During the previous week BTC was on a net losing side, decreasing its market cap by modest $ 20B or 1% on a weekly basis. Another altcoin that was driving the market to the downside was market favourite Solana, with a drop in value of 6% or $7.4B. ETH and XRP were coins which gained the most in nominal terms. ETH managed to add $34.8B to its market cap, increasing it by 8.4%. XRP continues to drive market attention, with this week's surge of 28.7%, adding another $24.5B to its market cap. ADA was another altcoin with solid weekly performance, with an increase in its cap by $ 1B or almost 3%. THETA should be especially mentioned this week, as the coin gained 62% on a weekly basis, and was traded at the level of $3.11. Such an increase was rare to see previously with THETA. In relative terms, market attention was standing with Algorand, which increased its value by 53.3%, Filecoin was up by 32%, Uniswap was traded higher by 17%, while Maker gained 12% w/w.
Increased activity with circulating coins continues. This week Polygon was on a negative side, with a decrease of total coins on the market by 3.9%. On the opposite side was Filecoin, with an increase by 0.8%, IOTAs number of coins increased by 0.5%, while Stellar added 0.2% of new coins. Tether should be especially mentioned, as this week stablecoin increased its number of coins by 1.4%, same as its market capitalization.
Crypto futures market
As of the end of the previous week, the crypto futures market eased a bit for BTC, in line with the spot market developments. BTC futures were traded more than 2% lower for all maturities. During the week, futures maturing in December 2024 reached the level of $100K, however, they are ending the week at $98.540. However, futures from February 2025 are holding above $100K, where December 2025 closed the week at $107.120.
On the opposite side were ETH futures which were traded in green by more than 8% for all maturities. December 2024 ended the week at the level of $3.631, while those maturing a year later were last traded at $3.894. It is important to note that futures maturing in March 2026 are nearing toward the $ 4K level, while the closing price was $3.966.
