The week ending December 19, 2025, marked a profound decoupling of global economies. AI-driven technology acted as a bulwark against weakening consumer sentiment, seen in Nike’s decline. Meanwhile, the Bank of Japan enacted a historic rate hike while the Bank of England cut interest rates.
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The week saw a profound divergence and “Great Rotation”. The Fed’s “hawkish cut” drove cyclical and value stocks, propelling the Dow Jones to record highs. Yet, the “AI trade” faced a reality check from Oracle and Broadcom warnings, dragging the tech-heavy Nasdaq Composite down. Investors now demand tangible returns.
The week ending December 5, 2025, defined a “Great Divergence” in global finance. As US markets rallied on cemented Federal Reserve rate cut expectations, Japan’s equity market struggled under rising bond yields. Conversely, India emerged as a global growth engine following the Reserve Bank’s unanimous decision to cut rates.
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The week saw infrastructure fragility (CME outage) overshadowed by optimism. US markets rallied as the probability of a December Fed rate cut surged to a confident 85-87%. India delivered a stunning 8.2% Q2 GDP growth, reinforcing its status as the global economy’s primary engine. Policy divergence is now key.
The trading week ending November 21, 2025, involved a “Triple Whammy” of valuation recalibration, monetary ambiguity, and geopolitical realignment. The AI trade hit a “priced for perfection” phase, causing a tech rout led by Nvidia despite stellar earnings. Simultaneously, U.S.-brokered peace plans for Ukraine and Gaza reduced the war risk premium, collapsing crude oil and defence stock prices.
The week ending November 14, 2025, marked a “painful turning point”. Optimism died as the U.S. government shutdown caused a “data blackout”, shattering hopes for a Fed rate cut. This uncertainty provided the backdrop for an AI “crisis of confidence”. SoftBank’s sale of its entire Nvidia stake sparked a global sell-off over “stretched valuations”, ending the “everything rally”.
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