Markets Climb as AI Momentum and Interest-Rate Optimism Lift Investor Confidence
Week Ending November 28th, 2025
I didn’t post a market update last week as I was in Ontario meeting with clients, but here’s a full recap of what happened in the markets over the shortened U.S. Thanksgiving week.
Markets finished higher as renewed enthusiasm for artificial intelligence (AI) and growing optimism over potential Federal Reserve rate cuts boosted investor sentiment. It was a strong week across both U.S. and international markets.
The S&P 500 gained 3.73%, the Nasdaq jumped 4.91%, and the Dow rose 3.18%. International stocks (MSCI EAFE) were also strong, up 3.15%.
In Canada, the S&P/TSX Composite Index posted a modest gain of roughly 0.4%–0.6%.
Energy and financials held steady, while materials (especially gold-related names) saw some strength on higher commodity prices.
Market Overview
Weekly Market Performance (November 24 – November 28, 2025)
- S&P 500: +3.73%
- Nasdaq Composite: +4.91%
- Dow Jones Industrial Average: +3.18%
- MSCI EAFE (International Developed Markets): +3.15%
- S&P/TSX Composite Index (Canada): +0.4% to +0.6%
U.S. Markets: AI Momentum and Rate-Cut Optimism
Markets kicked off the week with a strong rebound after one of the largest technology companies unveiled new artificial intelligence plans, reigniting excitement across the entire AI sector.
Highlights from the week:
- Monday’s rally was the strongest one-day move for the Nasdaq in more than six months
- AI-linked megacap stocks lifted the broader market
- Growing confidence that the Federal Reserve could lower rates in early 2026 boosted risk appetite
- A holiday week with lighter trading helped fuel positive momentum
Stocks extended gains for five straight sessions, finishing the week on a very strong note.
Canada & the TSX
The Canadian market held steady and tracked global strength, with a familiar pattern seen across sectors:
Sector Snapshot
- Technology: Mild strength early in the week, but lagged U.S. tech
- Energy: Supported by relatively stable oil prices
- Financials: Steady and helped carry the TSX higher
- Materials: Benefited from firmer gold and copper prices
While Canada doesn’t benefit from the same AI-driven tech surge as the U.S., the TSX continued to get support from value-oriented sectors such as financials, industrials, and commodities.
What’s Driving the Market
AI Excitement Back in the Driver’s Seat
A major tech company’s updated AI business strategy boosted confidence that AI earnings growth remains strong heading into 2026. This lifted the Nasdaq and other growth-oriented areas of the market.
Interest-Rate Speculation Builds
Investors increasingly expect the Federal Reserve to adjust rates in the months ahead.
Lower rates typically support both stocks and bonds, which contributed to the positive tone this week.
Focus Shifts to the Consumer
As holiday shopping ramps up, markets are watching consumer spending closely.
- September retail sales slowed slightly
- Consumer confidence for November fell to 88.7 from 99.5, reflecting caution
- Investors are now awaiting the October retail sales report for more direction
Consumer data will be critical in shaping expectations for economic growth going into year-end.
Why This Matters
Weeks like this highlight how quickly markets can shift based on investor sentiment and economic expectations.
Key takeaways:
- AI continues to be a powerful driver of market gains
- Interest-rate expectations remain a major source of volatility
- Canada continues to benefit from strong value and commodity-driven sectors
- A diversified portfolio helps balance out these swings and keeps long-term plans on track
Economic Snapshot
Federal Reserve Commentary:
Fed officials continue to emphasize that interest-rate decisions are “data dependent.”
With consumer spending and inflation data still coming in, markets will be watching upcoming economic reports closely.
This Week: Key Economic Data
Monday, December 1
- PMI Manufacturing Index, ISM Manufacturing
Tuesday, December 2
- Auto Sales
Wednesday, December 3
- ADP Employment Report
- Import Prices (Sept)
- PMI Services
- ISM Services
Thursday, December 4
- Weekly Jobless Claims
- Trade Deficit (Oct)
Friday, December 5
- PCE Price Index (Sept)
This Week: Companies Reporting Earnings
Tuesday, December 2
- CrowdStrike (CRWD)
- Marvell Technology (MRVL)
Wednesday, December 3
- Salesforce (CRM)
- Snowflake (SNOW)
Thursday, December 4
- Kroger (KR)
“He who is not courageous enough to take risks will accomplish nothing in life."
– Muhammad Ali
What word measures weight and turns negative if spelled backwards?
Last Week's Riddle: Glittering points that downward thrust. Sparkling spears that cannot rust. What are they?
Answer: Icicle
Joanne was able to see the Raptors play the Brooklyn Nets while visiting Toronto this past week.
Footnotes and Sources
1. WSJ.com, November 28, 2025
2. Investing.com, November 28, 2025
3. CNBC.com, November 24, 2025
4. CNBC.com, November 26, 2025
5. CNBC.com, November 28, 2025
6. WSJ.com, November 25, 2025
7. IRS.gov, May 29, 2025
8. Google Arts & Culture, June 12, 2025
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