NEW YORK: The first full trading week of the new year could shake the U.S. stock market out of its winter holiday slumber as the monthly jobs data headlines a busy start to 2026 for investors. Stocks slid in the final session of 2025, with the benchmark S&P 500 (SPX) falling into a monthly loss for December. But the index still climbed more than 16% in 2025, its third straight year of double-digit percentage gains, while the Cboe Volatility Index (VIX) was last just above its lows for the year.
Trading volumes were thin at the end of 2025, but the new year could get off to an eventful start. Aside from economic data, investors await a U.S. Supreme Court decision on President Donald Trump’s tariffs along with his choice of a new Federal Reserve chair, and U.S. corporate earnings season is around the corner.
In the first session of 2026 on Friday, the S&P 500 posted a slim gain as semiconductor shares rallied. While the S&P 500 is near record highs, it is also around the same level it was in late October, noted Matthew Maley, chief market strategist at Miller Tabak. “The market is looking for direction,” Maley said. “We break out of these ranges and that’s going to give either people a lot of confidence or a lot of concern depending on which way it breaks”.
The employment data due on January 9 could provide a jolt either way. Concerns over weakness in the labor market prompted the Fed to lower interest rates at each of its last three meetings of 2025, as the U.S. central bank juggles its goals of full employment and contained inflation.
Lower rates have supported equities, but the extent of further cuts in 2026 is unclear. Fed officials were divided over the path for monetary policy at the most recent meeting in December. Inflation remains above the Fed’s 2% annual target.
