December 26th Market Overview

Happy Friday

Gold and silver topped going into all time highs at the end of the year and both having their best year since 1979.

What's strange to me is stocks are also at all-time highs. Big money is bullish on earnings but hedging against the dollar. Both can be true at once, and apparently are.

Let’s dig in...

Today's Big Picture

Nvidia Licenses Tech from AI Chip Startup Groq (Not xAI's Grok) 
CNBC initially reported Nvidia was acquiring Groq, an AI chip startup, for $20 billion. That's wrong. Groq clarified it's a licensing deal where Nvidia gets access to their LPU chip technology and hired founder Jonathan Ross plus key staff. Some analysts say Groq's chips only handle a small subset of inference workloads anyway.

Precious Metals Go Parabolic 
Gold hit $4,579 intraday for its 54th record close of the year. Silver broke $76 for its 5th straight record. Citadel's Ken Griffin nailed it: investors now view gold as the safe-harbor the dollar used to be. Im going to keep repeating that one as I know you have heard it from me before.

Market Broadening Into 2026 
Christmas eve’s record high wasn't led by tech. Financials and industrials drove the move. U.S. Bank's Tom Hainlin calls it a confidence signal: tax bill tailwinds plus Q4 rate cuts are lifting more than just the Mag 7.

Market Overview

Index Performance

Stock Spotlight

Nvidia $NVDA ( ▲ 1.75% ) 
inched higher on the Groq licensing deal. Bernstein's Stacy Rasgon sees it as a strategic balance sheet move to maintain dominance.

Micron Technology $MU ( ▼ 0.58% ) 
and SanDisk $SNDK rose after reports Samsung and SK Hynix are raising HBM3E prices by nearly a fifth for 2026 deliveries.

Freeport-McMoRan $FCX ( ▲ 1.8% ) 
climbed as gold and other metals hit records. The mining sector is printing money right now.

Big Name Updates

Target $TGT ( ▲ 2.1% ) 
rose after the Financial Times reported hedge fund Toms Capital is building a significant stake. The activist is known for pushing changes at US Steel and Kellanova. Target's CEO Brian Cornell steps down in February.

Nike $NKE ( ▲ 1.24% ) 
Apple CEO Tim Cook doubled his stake, buying about $3 million worth. He's been on Nike's board since 2005. Market read it as a vote of confidence in Elliott Hill's turnaround.

Oracle $ORCL ( ▲ 0.07% ) 
On pace for the worst quarterly performance since 2001. Investors doubt the company can scale server farms fast enough for OpenAI's $300 billion commitment.

Other Notable Company News

Ross Stores $ROST ( ▼ 0.52% ) 
hit all-time highs this month after opening 90 new brick-and-mortar locations while competitors closed stores.

Western Digital $WDC ( ▲ 0.72% ) 
leads the S&P 500 this year with gains over three-fold.

Robinhood $HOOD ( ▼ 0.79% ) 
is the fourth-best performer in the index this year.

Newmont $NEM ( ▲ 0.95% ) 
is up big as gold prices carried gold miners higher.

Sector Watch

Bond Market

Thin holiday trading kept yields quiet. The dollar hit its highest since August earlier this week, but weakness resumed Friday as gold ripped higher. I'm watching whether the "debasement trade" intensifies heading into year-end.

Policy Watch

Geopolitics

The U.S. is blockading Venezuelan oil tankers and pressuring the Maduro government. Washington also launched a strike against ISIS in northwestern Nigeria. Both moves added to precious metals' “haven” appeal.

EV Policy Shifts

The EU scrapped its 2025 EV mandate. Trump rolled back Biden-era fuel economy standards. The federal EV tax credit expired at Q3's end. Ford, GM, and Stellantis are all backing away from massive EV investments. If demand rebounds, they may be caught flat footed.

Fed Watch

Markets are pricing less than a one-in-six chance of a January rate cut. March odds are more split. Three cuts happened this year, but the Fed's signaling caution for 2026.

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What to Watch

Target's Activist Pressure 
Toms Capital building a stake while CEO Brian Cornell exits in February. New CEO Michael Fiddelke inherits a stock down over a quarter this year. Activist playbook usually means cost cuts or strategic changes coming.

Oracle's Freefall 
Down 30 points this quarter, worst since the dot-com bust. The bear case: they can't scale server farms fast enough for OpenAI's $300 billion commitment. At some point this becomes a value play. Not yet clear when.

Gold Pullback Risk 
54 record closes this year. Silver up over 150%. These moves don't go in a straight line forever. If you're long miners, think about where you'd trim.

Memory Chip Pricing for 2026 
Samsung and SK Hynix raising HBM3E prices signals tight supply. Good for Micron and the AI infrastructure buildout theme.

Thanks for reading 🙂

- John

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