Good morning investors! The market will close early today.
Today we cover:
GDP surges past expectations
Holiday sales report
Precious metals rule
📊 Economy and News
US Q3 GDP Surges 4.3% on Strong Consumer Spending
The U.S. economy expanded at a 4.3% annualized rate in the third quarter, its fastest pace in two years, exceeding economists' forecasts of 3.3%. The Commerce Department's delayed initial estimate highlighted robust consumer spending, a sharp export rebound, business investment in AI and equipment, and government outlays as key drivers.
Consumer spending rose 3.5%, the strongest in nearly a year, led by higher-income households benefiting from stock market gains. However, middle- and lower-income groups curtailed spending amid high inflation, exacerbated by import tariffs, creating a "K-shaped" recovery.
Inflation accelerated, with the PCE price index up 2.8% (core at 2.9%). Corporate profits jumped $166.1 billion.
Though outdated due to a 43-day government shutdown, the report signals economic resilience, likely reducing chances of a Federal Reserve rate cut in January. Momentum has since slowed, with stalled retail sales and potential Q4 drags from the shutdown.
President Trump credited tariffs for the growth and low inflation on social media.
Global hits:
Bank of Spain upgrades growth outlook but many Spaniards feel stretched.
Canada’s economy hits a wall in October, GDP contracts 0.3%.
Turkiye raises net monthly minimum wage by 27% for 2026.
Singapore’s inflation in November remained steady at 1.2%..
Check this: Silver price hits $70 per ounce, for the first time, as historic rally accelerates. The metal is now up 140% in 2025. Other metals had a great day too, including copper that jumped over $12,000 a ton.
Similarly, gold reached a record high above $4,480/oz. In fact, gold futures for February delivery rose settled 0.8% higher at $4,505.7, after hitting a record of $4,530.80 per ounce. Spot gold was up 1.03% to $4,491.23 per ounce.
U.S. pushes additional tariffs on Chinese chips to June 2027.
Falling confidence: U.S. consumer confidence declined in December 2025, with the Conference Board's index falling 3.8 points to 89.1, slightly worse than economists' forecast of 91.0. Consumers cited persistent worries about high prices, inflation, tariffs, trade, politics, as well as rising mentions of immigration, war, interest rates, taxes, and insurance.
Consumer spending: According to Visa, U.S. holiday sales rose 4.2% from November 1 through December 21 compared to the same period last year, lagging behind the previous year's 4.8%.
Inflation-adjusted sales increased a modest 2.2%, with shoppers proving selective—favoring gadgets (up 5.8%), clothing (up 5.3%), and essentials over tariff-hit categories like home decor (up just 0.8%)—while e-commerce surged 7.8% but physical stores still accounted for 73% of spending.
Visa's principal economist described the season as "average" rather than spectacular.
📈 Stocks
S&P 500 6,909.79 (+0.46%)
DJIA 48,442.41 (+0.16%)
NASDAQ 23,561.84 (+0.57%)
BRENT CRUDE 62.94 (-0.17%)
* Prices as of Dec 24th, 12:20 AM UTC
ServiceNow's $7.75B Armis Acquisition: Building an AI Security Powerhouse
ServiceNow is acquiring cybersecurity firm Armis for $7.75 billion in cash—its biggest deal yet—to become an "AI Control Tower" for enterprise security.
Deal closes in H2 2026, expected to triple ServiceNow's security and risk market share.
What is Armis?
Armis offers agentless visibility and protection for hard-to-reach devices (IT, OT, IoT, medical). It tracks assets traditional tools miss, providing real-time threat detection and remediation.
The combo with ServiceNow's IT platform aims to deliver unified, AI-driven security workflows—easy to sell to existing customers.
Market Reaction
Shares dipped amid concerns over the high price and 2025 M&A spree (including Moveworks and Veza). $NOW is down ~25% YTD.
With global cybersecurity spend topping $210B+, ServiceNow is betting on "intelligent trust" as key to the AI era.
Interesting: The FDA on Monday approved the first-ever GLP-1 pill from Novo Nordisk. The approval gives the Danish pharma giant a head start against U.S. rival Eli Lilly.
Waymo is implementing changes to its fleet of driverless cars for times when “infrastructure fails” after the company had to halt service during blackouts in San Francisco.
Surprising: US bans new foreign drone models in a blow to Chinese giant DJI. China has already requested the US to reconsider the move.
The average price of unleaded gasoline in the U.S. has fallen to its lowest level since 2021.
💵 Personal Finance
Trump’s ‘No Tax on Tips’ Deduction Excludes Many Tipped Workers
President Trump’s “no tax on tips” policy, enacted in 2025, allows eligible workers to deduct up to $25,000 in qualified tips annually on federal returns from 2025 to 2028, with phaseouts above $150,000 (single) or $300,000 (married) in modified adjusted gross income. However, millions of the estimated 6 million tipped workers won’t benefit.
Low earners often owe no federal income tax due to standard deductions and credits like the EITC, while workers in certain industries (e.g., health care, law, financial services) classified as “specified service trade or businesses” are ineligible, though temporary relief may apply for 2025 pending final IRS rules.
Experts note the deduction primarily aids middle- and higher-income tipped workers rather than the lowest-paid.
💰 Be a Better Investor
“Do not save what is left after spending; instead spend what is left after saving.”
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