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Stocks Drift Into Year-End Lull as Tech Rally Cools and CAC 40 Trails

Investors face thin holiday trading with Fed guidance largely unchanged after 2025 rate cuts.

Overview

  • Trading volumes stayed low across major markets in the final sessions of the year, keeping moves muted and largely technical.
  • Paris slipped in a shortened session, leaving the CAC 40 up a little over 10% for 2025 yet lagging peers such as Frankfurt, London, Milan and Madrid.
  • Wall Street edged lower on profit-taking in major tech and AI names, capping a strong year with the S&P 500 up about 17% and the Nasdaq up roughly 21%.
  • Federal Reserve minutes highlighted internal dissent but offered no surprise, pointing to potential further easing in 2026 if inflation cools and to caution from some officials after three 2025 cuts.
  • European defense shares weakened as diplomacy over Ukraine advanced, with Zelensky citing a U.S. offer of 15-year security guarantees and Moscow’s drone-attack accusation denied by Kyiv, while dealmaking continued with SoftBank buying Digital Bridge for about $4 billion and Meta acquiring the AI agent Manus.