Today’s Market Recap: Nasdaq Leads Gains Amid Economic Strength

The Federal Reserve's preferred gauge of inflation aligned with expectations in November, reinforcing confidence in the strength of the U.S. economy. The personal consumption expenditures (PCE) price index rose 2.8% year-over-year and 0.2% month-over-month, while the core PCE—excluding food and energy—remained elevated at an annualized 2.9%. Supported by resilient consumer spending, the report also reflected a continued decline in the personal savings rate, pointing to sustained household activity despite tighter financial conditions.

U.S. economic growth in the third quarter was slightly stronger than previously estimated. Real GDP was revised up to an annualized pace of 4.4%, the fastest expansion in two years. The upward revision was driven by firm consumer demand, stronger exports, and a reduced drag from inventory adjustments. Combined with still-elevated inflation, the data strengthen the case for the Fed to maintain its current policy stance at the upcoming FOMC meeting.

In Europe, concern is growing over renewed volatility in transatlantic relations after Donald Trump reversed course on a proposed tariff package aimed at the EU. The sudden shift caught many European policymakers off guard, fueling anxiety over Trump's erratic policy style and its implications. Some EU officials warned that the gesture could be a strategic attempt to divide allies. As distrust deepens, fears of a widening rift between Washington and Brussels are becoming more pronounced.

Intel shares plunged more than 11% in after-hours trading after the company issued disappointing first-quarter guidance. While fourth-quarter results came in ahead of expectations—helped by a 9% increase in AI and data center revenues and a $5 billion sale of Nvidia shares—investors were unsettled by the company's warning that supply constraints would intensify in Q1. Management cited below-target manufacturing yields and acknowledged that ramping up the company’s foundry operations will take time. The CFO noted that limited inventory and production issues had already constrained seasonal demand fulfillment.

A wave of capital flight from U.S. assets is gaining momentum among Nordic pension funds. Denmark’s AkademikerPension announced a full exit from U.S. Treasuries by the end of January, while Sweden’s Alecta has liquidated most of its $11 billion worth of U.S. holdings. Greenland’s SISA Pension Fund is also weighing a sharp reduction in U.S. equities, which currently account for around half of its portfolio. The moves reflect growing concern among European long-term investors about exposure to U.S. fiscal pressures and heightened geopolitical risk.

Donald Trump has filed a lawsuit against JPMorgan Chase and CEO Jamie Dimon, seeking at least $5 billion in damages over alleged political bias. The president claims the bank engaged in "debanking" by cutting off financial services to him and his businesses due to ideological reasons. The case follows multiple public remarks by Trump accusing major banks of discriminating against clients based on political affiliation.

At the 2026 Davos Forum, Elon Musk unveiled plans to begin public sales of Tesla’s humanoid robot, Optimus, by the end of next year. Musk said the robot is being designed to handle a wide range of user-driven tasks and could perform "almost anything you ask" with sufficient reliability and safety. He revealed that fully autonomous Robotaxi service is already underway in Austin, Texas, without human safety supervisors on board. According to Musk, artificial general intelligence (AGI) could surpass human-level capabilities as soon as late 2026.

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