Stocks are sliding on the final trading day of 2025, but despite a recent four-day losing streak, the S&P 500 is poised to finish the year with roughly a 17% gain—marking its third consecutive year of double-digit growth. U.S. public markets will be closed Thursday for New Year’s Day.
Dollar Weakness and Chip Demand Dominate Year-End Trading
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Investors are navigating a mixed bag of signals as 2025 draws to a close, with currency fluctuations and semiconductor shortages taking center stage.
- The U.S. dollar is tracking its worst year since 2017, pressured by tariff concerns and Federal Reserve policy speculation.
- Nvidia is scrambling to meet surging demand for its H200 chips, particularly from China, with orders exceeding current supply.
- ByteDance is reportedly prepared to invest up to $14 billion in Nvidia’s H200 chips in 2026, contingent on import allowances.
- Insider buying at Nike and positive analyst ratings for Alphabet and Capital One signal confidence in those companies’ futures.
The U.S. dollar is currently on track for its worst performance since 2017, weighed down by anxieties surrounding President Donald Trump’s tariffs and his administration’s efforts to influence the appointment of a more dovish Federal Reserve chair in 2026.
Nvidia Faces Chip Supply Crunch Amid Chinese Demand
Reuters reported this morning that Nvidia has contacted Taiwan Semi to increase production of its H200 chips. The move comes in response to robust demand from China, where Nvidia has received over 2 million orders for the H200 chip, slated for delivery in 2026, despite only having 700,000 units currently available.
ByteDance, the parent company of TikTok, could potentially spend up to 100 billion yuan (approximately $14 billion) on Nvidia’s H200 chips in 2026, according to the South China Morning Post, assuming imports are permitted. This represents a significant increase from the 85 billion yuan (roughly $12 billion) spent with Nvidia in 2025.
Executive Confidence and Analyst Upgrades
Nike CEO Elliott Hill recently purchased approximately $1 million worth of company stock, as disclosed in a regulatory filing. This insider buying is often interpreted as a positive signal, indicating management’s belief in the company’s future prospects.
Citizens raised its price target for Alphabet to $385, up from $340, while reiterating a buy rating. Analysts cited continued strength in the company’s search business and potential upside from updates regarding its custom silicon chips. Analysts at Citi also increased their price target for Capital One to $310, from $290, anticipating a roughly 27% increase from Tuesday’s closing price, based on upcoming fourth-quarter earnings reports.
Megadeals Return and China Sets Growth Target
Bankers are preparing for a surge in megadeals in 2026, following a strong 2025 that saw a record 68 deals valued at over $10 billion, according to LSEG data dating back to 1980, as reported by The Wall Street Journal. This positive trend is expected to benefit banks like Goldman Sachs.
Chinese President Xi Jinping announced that the country is expected to achieve its 5% gross domestic product growth goal for 2025. In a televised New Year’s speech, Xi emphasized the need for China to “remain confident, seize the momentum and steadily advance high-quality development.”
Tesla’s Cybercab Production Ramp-Up
Tesla CEO Elon Musk announced via social media that production of the Cybercab is scheduled to begin ramping up in April. Shares of the electric vehicle maker were up 1% in premarket trading.
