US Stock Market Today, December 4, 2025: Wall Street Trades Near Record Highs as Rate-Cut Hopes Rise

On Thursday, Wall Street is ready for a smooth start as the US stock indexes are very much in contango of the unprecedented highs. The rally from Wednesday was particularly supported by small caps, energy, and financials. Now, attention of the investors is drawn to important labor-market data and the Federal Reserve meeting next week, where another interest-rate cut is expected by the markets.

Market Snapshot: Indexes are very close to the record territory

Key US indices raised their value on Wednesday and further:

• S&P 500: 6,849.72 (+0.3%)
• Dow Jones: 47,882.90 (+0.9%)
• Nasdaq Composite: 23,454.09 (+0.2%)
• Russell 2000: 2,512.14 (+1.9%)

Market breadth was quite strong, with almost 67% of the components in the S&P 500 being up, even though some very big-cap tech stocks were weak.

Experts say that all three major indicators have gained more than 10% so far in 2025 owing to strong economic data and good corporate earnings.

Futures Today: After the Rally of Wednesday, A Pause

On Thursday, US stock futures had no significant change. This indicates that the traders are not very confident and are waiting for the new economic releases:

• S&P 500 futures: unchanged
• Dow futures: a bit up
• Nasdaq futures: a bit up

Investors are waiting for the unemployment benefits claims data and are getting ready for the Federal Reserve's meeting on December 9-10, where one more rate cut is expected.

What Became the Power Behind Wednesday's Spike

The ADP employment report, which was softer than expected, indicated that the US companies had cut 32,000 private-sector jobs in November—hence the biggest drop since early 2023. Investors interpreted the data to mean that the labor market is cooling just right for another rate cut.

At the same time, the services PMI grew to 52.6, showing continued expansion and zachte price pressures. Treasury yields dropped and VIX hovered around 16, indicating no panic in trading.

Leading Sectors: AI Infrastructure, Retail, and Small Caps

The stocks that posted Wednesday's gains were:

• Microchip Technology and Marvell Technology, both up thanks to the AI and data center demand.
• American Eagle Outfitters, which was up over 15% after the release of a very good Q4 report.
• iRobot, which was a big gainer of over 70% due to the renewed optimism regarding US robotics policy.
• The small-cap stocks took the market momentum, with the Russell 2000 recording its largest daily gain in weeks. Besides this, energy and financials also did well, while the utilities sector and mega-cap tech were the laggards.

The Watch List

Investors are looking forward to the economic calendar on Thursday:

First-time jobless claims (prediction: 220,000)

Continuing claims (previously: 1.96 million)

Factory orders

The Atlanta Fed's GDPNow update, which is currently projecting a growth rate of 3.9% for Q4

These data will help to clarify whether weak ADP figures have signaled a wider cooling trend or not.

Earnings Season

A number of large companies will report their earnings today, such as:

Kroger, Dollar General, Hormel Foods, SAIC (pre-market)

HPE, Ulta Beauty, DocuSign, SentinelOne (after hours)

The results will provide fresh insights into consumer spending, tech demand, and corporate IT investment.

Fed Watch: December Cut Expected

The market perceptions of a 25-bps reduction in the interest rate next week are around 80-90%. However, the analysts are very much interested in the Fed's interest rate projections for 2026 and the guidance from Chair Jerome Powell.

Global Markets Follow the Lead of Wall Street

European shares gained a little, and Asian shares showed mixed results—Japan went up while China went down due to fresh problems in the property sector. At the same time, the investors all over the world are preparing for a controlled slowdown in the US and a gradual Fed easing cycle.

2026 Outlook: Optimism with Caveats

The majority of the strategists foresee the next year to bring moderate gains that are very much driven by lower borrowing costs and continuous earnings growth. However, the others raise a cautionary flag that high valuations and market concentration could, under certain unfavorable conditions such as a deteriorating labor market, create a risk of downside.

Bottom Line

As of December 4, 2025, Wall Street is in a late-cycle rally propped up by cooling inflation, soft yields, and increased likelihood of a December rate cut. However, with the market being so close to the record highs, investors are becoming more and more sensitive to surprises regarding the jobs data and the Fed's 2026 path