Daily Market Update: Markets Rally on Fed Rate Cut Hopes

TLDR

• Bitcoin stabilized around $88,800 on Monday as risk assets gained across global markets
• Gold surged to record high above $4,380 per ounce, heading for best year since 1979
• Asian stocks climbed over 1% while S&P 500 traded within 1% of all-time high
• Crypto market saw $576 million in liquidations during recent volatile trading period
• Fed rate cut odds hit 86.9% for December meeting as Wall Street forecasts strong 2026

Bitcoin maintained its position around $88,800 on Monday as global markets demonstrated renewed interest in risk assets. The cryptocurrency traded in a stable range while equities and commodities posted widespread gains.

The crypto market showed signs of recovery after recent turbulence. Ether climbed back above the $3,000 level during Monday’s session.

Other major cryptocurrencies joined the rebound. XRP, Solana, and Dogecoin all posted gains following a volatile stretch of trading.

The recent volatility resulted in over $576 million in crypto positions being liquidated. Traders pointed to thin year-end liquidity as a factor limiting the strength of rallies.

Gold reached an all-time high above $4,380 per ounce on Monday. The precious metal is tracking toward its strongest annual performance since 1979.

Gold Rally Driven by Central Banks

Central bank purchases and consistent inflows into gold-backed exchange-traded funds have powered the metal’s ascent. Growing market expectations for Federal Reserve rate cuts in 2026 provided additional support.

Asian equity markets advanced more than 1% led by technology shares. The MSCI Asia Pacific Index rose as U.S. equity futures also gained ground.

The S&P 500 closed within 1% of its record high after posting five consecutive sessions of gains. The Nasdaq Composite ended the month within 3% of its peak.

The Dow Jones Industrial Average traded less than 2% below its record closing level. Markets finished November on a positive trajectory despite earlier volatility.

Traders currently assign an 86.9% probability to a quarter-point Fed rate cut at the December policy meeting. The Federal Reserve entered its blackout period on Saturday ahead of its December 9-10 meeting.

President Trump confirmed he selected his nominee for the next Federal Reserve chair. He expressed expectations for rate cuts from his nominee without revealing the name.

Wall Street Bullish on 2026

Major investment banks issued optimistic forecasts for next year. JPMorgan strategists set a year-end 2026 target of 7,500 for the S&P 500, implying nearly 10% upside from current levels.

HSBC analysts also projected the index would reach 7,500 by the end of next year. Deutsche Bank went further with an 8,000 target for the benchmark index.

All three firms cited the artificial intelligence technology cycle as a primary driver. They expect AI investments to fuel earnings growth and support higher valuations.

Technology stocks showed mixed performance over the past month. Meta declined 13% while Nvidia dropped approximately 8% during November.

Research from K33 shows long-term bitcoin holders are approaching the end of an extended selling phase. Institutional buyers have been absorbing bitcoin at a faster rate than miners can produce new supply.

Corporate treasuries and exchange-traded funds increased their bitcoin acquisitions even after prices dropped more than 30% from October peaks. Japan’s central bank rate hike pushed government bond yields to multi-year highs as the yen strengthened against other currencies.

The crypto market continues taking direction from broader macroeconomic trends. Rate cut expectations and safe-haven demand for gold provided support while fourth-quarter losses still weigh on sentiment.

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