Morning Market Brief: Cyclicals Lead as Tech Splits

Introduction#

U.S. equities head into Monday, November 24, 2025 with a constructive tone after a broad-based rally to close last week. According to Monexa AI, the S&P 500 (^SPX) finished Friday at 6,602.99 (:+0.98%), the Dow (^DJI) at 46,245.41 (:+1.08%), and the Nasdaq Composite (^IXIC) at 22,273.08 (:+0.88%). Gains were led by economically sensitive groups—consumer cyclical, industrials, and basic materials—while mega-cap technology posted a mixed tape. Volatility eased modestly as the CBOE VIX (^VIX) slipped to 23.35 (:-0.34%), though it remains elevated versus recent averages.

Overnight, headlines pointed to a tentative risk-on bias. European stocks were poised to open higher in sympathy with global markets, though defense shares lagged as talks continued on a Ukraine peace framework, according to Reuters. Inflation in Singapore topped expectations, reinforcing a theme of uneven disinflation across Asia per Reuters. On policy, Bloomberg’s MLIV desk suggested volatility could stay elevated as traders parse incoming data and Fed communication in a holiday-shortened week (Bloomberg. CNBC’s weekend wrap noted that U.S. futures firmed after Friday’s rebound, even as last week ended lower overall (CNBC. The CNN Fear & Greed Index ticked up but remained in “Extreme Fear,” framing a fragile improvement in risk appetite (CNN Business.

Market Overview#

Yesterday’s Close Recap#

The final session of last week delivered a classic cyclical rotation. According to Monexa AI, breadth improved across most major sectors, with consumers, industrials, and materials leading advances. Technology performance was split: a cohort of mid-cap software and IT services rallied, while several mega-cap platforms and key semiconductors lagged, tempering index-level upside.

Despite the advance, positioning remains cautious. Monexa AI data show the S&P 500 closed below its 50-day average (6,711.41) and well above its 200-day (6,162.75), while the VIX, at 23.35, sits above its 50-day (18.28), underscoring that downside hedging demand has not fully normalized. Friday’s aggregate volume on the S&P 500 was below its average, suggesting investors favored selective risk-taking over aggressive accumulation.

From a style standpoint, the heatmap shows mid-cap and discretionary leadership. Hardware names such as HPQ outperformed, while large platform software was mixed. Payments, asset managers, homebuilders, travel, and ad-driven communication platforms were notable winners. Defensive areas lagged on a relative basis, and utilities traded idiosyncratically.

Overnight Developments#

European equity markets tracked global positivity into Monday, though defense stocks underperformed for a second day as the U.S. and Ukraine reported weekend progress in talks without a final agreement on security guarantees, per Reuters. That cross-current aligns with the U.S. tape, where select defense names trailed even as industrials rallied last week. In Asia, Singapore’s October inflation surprised to the upside, nearing a one-year high and exceeding economist estimates, according to Reuters. The inflation miss reinforced the idea that disinflation is uneven across regions, keeping global bond markets data-dependent.

Policy chatter remained center stage. Bloomberg’s morning brief flagged persistent uncertainty in the Fed path and the likelihood of elevated intraday volatility into the holiday, with traders calibrating the odds of near-term policy easing against incoming data (Bloomberg. CNBC highlighted that despite Friday’s bounce, last week’s U.S. indices finished lower, keeping sentiment sensitive to new macro surprises (CNBC. CNN’s Fear & Greed gauge continued to register “Extreme Fear” on Friday even as it edged higher, a reminder that confidence is still rebuilding from November’s drawdown (CNN Business.

Macro Analysis#

Economic Indicators to Watch#

With a holiday-shortened week ahead, markets are likely to be guided by inflation updates, consumer activity signals, and fresh cues from policymakers. According to Monexa AI’s news synthesis of “The Week Ahead,” investors will focus on a compact slate of U.S. releases and Fed-related communication that could shape expectations for December and early 2026. The tone in Treasurys was steady into the weekend on reports that policymakers remain divided over a near-term cut, a dynamic that keeps both duration and equity risk premia in flux (Reuters.

Given the tape’s factor rotation, two data clusters may carry outsized influence on Monday’s open and the early week. First, any indications that price pressures are re-accelerating abroad could nudge U.S. rate expectations higher at the margin, particularly if they echo in commodity-linked inputs. Second, consumer-linked prints and company updates remain pivotal as investors assess real-time demand heading into peak holiday spending.

Global and Geopolitical Factors#

The ongoing U.S.-Ukraine security dialogue remains an important geopolitical backdrop for defense equities and energy sentiment. While Reuters reported progress over the weekend without a finalized framework, European defense equities underperformed to start the week, and U.S. defense names lagged in Friday’s sector map. Any new headlines may continue to swing sentiment within aerospace and defense subsets.

Asia’s inflation surprise in Singapore, cited by Reuters, underscores a broader theme of asynchronous disinflation. If similar outliers appear elsewhere in Asia or Europe, markets could reassess the timing and trajectory of global easing cycles. Domestically, U.S. investors will remain focused on Federal Reserve signaling throughout the week, with Bloomberg’s MLIV noting a likely persistence of higher intraday vol as traders de-risk around the data window (Bloomberg.

Sector Analysis#

Sector Performance Table#

According to Monexa AI, sector performance at Friday’s close reflected a pronounced rotation into cyclicals, alongside strength in healthcare and materials. Utilities were the only sector to finish lower on the day.

Cyclicals led with convincing breadth. Homebuilders, travel and leisure, and select retailers all posted outsized gains, signaling investor preference for economically sensitive cash flows into year-end. Industrials rallied on freight and parcel strength and a rebound in capital goods, even as defense pockets softened. Basic materials advanced on chemicals, steel, and specialty inputs, indicating improving industrial demand expectations. Healthcare outperformed as biotech and medtech surged alongside gains in large-cap pharma and managed care. Technology lagged on a relative basis despite a modest gain, weighed by select mega-cap weakness and profit-taking in cybersecurity and parts of semis. Utilities declined on stock-specific drivers and rate sensitivity dispersion.

The session’s mixed technology profile is crucial for near-term index behavior. While the sector finished modestly higher, its internal dispersion—mid-cap software and IT services vs. a few mega-cap platform drags—preserves concentration risk. A sustained market advance will likely require either renewed leadership from the largest platforms or continued breadth from cyclicals to offset episodic mega-cap softness.

Company-Specific Insights#

Earnings and Key Movers#

Friday’s tape delivered clear winners across retail, software, and travel, with several marquee names shaping early-week narrative risk.

Within software, INTU rallied after beating expectations and lifting its full-year outlook. According to Monexa AI, the shares finished at $663.15 (:+4.03%) as Global Business Solutions and QuickBooks Online continued to drive high-teens to mid-20s growth, complemented by a strong quarter at Credit Karma and steady consumer tax seasonality. The beat-and-raise dynamic offers the kind of execution that investors rewarded this week, contrasting with parts of the AI-software complex.

By contrast, ESTC fell sharply despite delivering upside on revenue and EPS alongside a higher full-year guide, closing at $70.04 (:-14.67%). Monexa AI notes that investors focused on questions around the durability of longer-term growth, a “good news, bad reaction” pattern that has become common when valuation and execution narratives converge. The bifurcation within software—leaders rewarded for visible operating leverage while others are penalized despite solid prints—remains a theme to monitor into December.

Retail was a bright spot. Off-price leader ROST advanced to $174.00 (:+8.41%) on a beat and higher outlook as comparable sales rose and margins expanded. Department and specialty retail tone was constructive too, with GPS up to $24.55 (:+4.38%) after stronger-than-expected comps and raised full-year sales guidance, and membership retail staying resilient as BJ gained to $91.61 (:+1.13%) following a top- and bottom-line beat and higher profit forecast. These results reinforce a holiday narrative favoring value, off-price, and membership models that monetize traffic efficiently and manage inventory tightly.

In payments and financial services, sentiment improved across the board. PYPL rose to $60.57 (:+4.24%), MA to $540.40 (:+2.37%), and KKR to $118.67 (:+3.72%), while the money-center bellwether JPM was nearly flat at $298.02 (:-0.12%). The pattern aligns with a cautiously risk-on stance and a constructive read-through for consumer transaction volumes.

Industrials and travel delivered broad gains. Logistics and freight outperformed with ODFL at $134.28 (:+6.33%), trucking OEM PCAR at $102.99 (:+5.52%), airlines such as DAL at $58.57 (:+4.65%), and parcel leader UPS at $94.66 (:+4.17%). Builders and construction-linked suppliers rallied as DHI closed at $146.71 (:+6.84%), LEN at $123.16 (:+5.94%), and BLDR at $101.62 (:+7.14%). The breadth in these groups speaks to renewed optimism around freight, housing, and e-commerce flows into the holiday period.

Healthcare’s leadership was equally notable. Medtech and biotech outperformed as ALGN ended at $142.56 (:+7.34%), MRNA at $23.72 (:+6.08%), PODD at $331.17 (:+5.84%), and diagnostics and animal-health leaders IDXX and ZTS rose to $725.91 (:+5.30%) and $122.06 (:+5.32%), respectively. Large-cap pharma and managed care also participated, including ABBV to $236.28 (:+2.98%) and UNH to $319.97 (:+2.71%). In biotech, MDGL gained to $547.96 (:+1.08%) following an analyst upgrade and a higher price target reported by Monexa AI’s news feed.

Technology’s internal dispersion remains the swing factor for index-level direction. Hardware and IT services saw pockets of strength with HPQ at $23.96 (:+5.97%) and ACN at $251.85 (:+4.59%), and ad-driven platforms led communication services as Alphabet’s GOOGL and GOOG closed at $299.66 (:+3.53%) and $299.65 (:+3.33%), respectively. But several mega-cap tech names lagged, including MSFT at $472.12 (:-1.32%), NVDA at $178.88 (:-0.97%), and cybersecurity bellwether CRWD at $490.67 (:-2.12%). Streaming and commerce were mixed: NFLX fell to $104.31 (:-1.29%), while AMZN rose to $220.69 (:+1.63%). The divergence underscores why Friday’s rally leaned on cyclicals rather than a mega-cap resurgence.

Energy traded narrowly, with oilfield services and refiners firming while integrated majors were mixed. SLB advanced to $36.19 (:+2.86%), VLO to $173.45 (:+1.54%), and MPC to $190.62 (:+1.46%). Integrated leaders were flat-to-softer with XOM at $117.08 (:+0.06%) and CVX at $149.98 (:-0.22%). Utilities remained idiosyncratic, as AWK rose to $132.74 (:+3.60%) but VST and CEG declined to $168.59 (:-2.99%) and $338.11 (:-2.22%).

Corporate headlines over the weekend may steer early sector tone. The European Commission approved Omnicom’s acquisition of Interpublic without conditions, per Reuters, a development that could keep ad agency momentum intact after Friday’s gains in OMC to $74.87 (:+4.70%) and IPG to $25.72 (:+4.77%). Meanwhile, Bloomberg flagged that volatility may remain elevated around Fed narratives (Bloomberg, and CNBC noted improving sentiment into the holiday stretch despite last week’s net declines (CNBC.

On the AI front, headlines continued to stress a maturing narrative. Select reports discussed capacity constraints at one hyperscaler’s AI services pushing some workloads toward rivals, with an implication for share shifts among cloud platforms (CNBC. Other stories highlighted strategic partnerships and large forward capacity commitments across providers, including references to major players like MSFT and NVDA, without changing Friday’s price action dynamics captured by Monexa AI.

Beyond the megacaps, Monexa AI highlighted several stock-specific moves that may carry through. Industrial automation sentiment improved after a raised target for ROK, while cash-rich, high-ROE profiles like TEL also saw positive target revisions. In aerospace and defense, MOG-A posted mixed results—revenue stronger, EPS below expectations—while defense peers LHX and RTX weakened into the close, consistent with the softer defense read-through in the heatmap. In consumer membership retail, fundamentals at BJ continue to compare favorably versus higher-valuation peers, according to Monexa AI’s news summaries.

Extended Analysis#

The most important dynamic into Monday’s open is the balance between breadth and leadership. Friday’s risk-on move leaned heavily on cyclicals, travel, housing, and parts of healthcare and materials. That can carry an advance for a session or two, particularly when positioning is light and volatility has pulled back. But for the market to re-challenge recent highs, mega-cap tech will either need to stabilize or cede leadership to a sustained, multi-day cyclicals rotation. The mixed profile in technology—hardware and services up, select platforms and semis down—keeps index-level sensitivity high to moves in a handful of tickers.

Valuation and liquidity also matter in this tape. Monexa AI’s newsflow captured a stream of commentary about an “AI bubble” or a recalibration in the space. That narrative is not a call on fundamentals, which remain strong for several leaders, but it is affecting reactions to results and guidance. The price action in ESTC despite a beat-and-raise is a case in point: when markets are recalibrating long-duration growth assumptions, strong prints are not always sufficient to drive stocks higher. Conversely, the response to INTU shows that clear operating leverage and diversified revenue engines can still command premium multiples and positive estimate revisions.

On the consumer side, the combination of traffic resilience and margin discipline is being rewarded. Off-price and membership models are demonstrating pricing power through scale, mix, and fee economics. ROST, GPS, and BJ each offered some version of this playbook. Into the holiday run-up, the market appears willing to pay for inventory control and the ability to translate footfall into earnings upside.

Financials’ steady bid suggests investors are comfortable, for now, with credit risk and capital return profiles. With PYPL, MA, KKR, and BLK advancing, the payments and asset management complex is signaling confidence in transaction volumes and market activity. Banks’ muted moves—JPM was nearly unchanged—keep the focus on idiosyncratic drivers rather than a broad sector call.

Energy’s internals argue for selectivity. Services and refiners were the clearer expressions of strength, while integrated majors such as XOM and CVX were directionless to mildly negative. Until commodity prices or refining spreads break decisively one way or the other, the space may remain a stock-picker’s market rather than a beta trade.

Utilities’ dispersion remains pronounced, reflecting a mix of rate sensitivity, idiosyncratic project exposure, and the unique dynamics around merchant generation models. With AWK higher but VST and CEG lower, investors appear to be differentiating among balance sheets, regulatory constructs, and growth visibility rather than making a blanket defensive allocation.

Finally, Europe’s defense underperformance—linking back to Reuters reporting on Ukraine-related talks—mirrored the U.S. tape where LHX and RTX lagged. Until there is clarity on the policy path and procurement visibility, the group may continue to trade headline-to-headline.

Conclusion#

Morning Recap and Outlook#

Friday’s session tilted decisively toward cyclicals, with consumers, industrials, materials, and healthcare providing the breadth required to counterbalance mixed mega-cap tech. According to Monexa AI, the S&P 500’s +0.98% gain came with below-average volume and a VIX that eased to 23.35, leaving the market still sensitive to macro impulses and large-cap tech moves. Overnight headlines from Bloomberg, Reuters, and CNBC support a cautiously positive bias into the open, tempered by evidence of persistent rate uncertainty and uneven global disinflation.

For investors into Monday’s open, the primary catalysts are straightforward. First, watch whether cyclical leadership can extend for another session, especially in homebuilders, travel, freight, and materials. Second, monitor the mega-cap technology cohort—AAPL, MSFT, NVDA, GOOGL—for stabilization that could reduce index-level volatility and concentration risk. Third, track the consumer complex for further confirmation that value-oriented formats are capturing holiday spend efficiently. Finally, remain attentive to policy and geopolitical headlines; the bond market’s reaction function will continue to influence equity factor leadership on an intraday basis.

Key Takeaways#

The U.S. market enters Monday with improving breadth and a risk-on tilt, but with volatility still elevated relative to short-term averages. According to Monexa AI, cyclicals led Friday’s advance while technology was split, leaving concentration risk intact. Overnight headlines from Bloomberg, Reuters, and CNBC suggest a constructive but cautious setup before the bell. Execution and earnings quality are being rewarded, whereas long-duration growth stories without clear operating leverage can still face pressure even on positive prints. In this environment, investors should emphasize balance: participation in cyclical upside where fundamentals are improving, alongside risk controls for policy and mega-cap volatility that can still dominate day-to-day index moves.