Stock Indexes Post Mixed Results as Energy Climbs Higher While Homebuilders Fall Lower

The market painted a picture of divergence today, with different asset classes pulling in separate directions. The S&P 500 slipped -0.05%, while the Dow Jones Industrials managed a small gain of +0.43%, and the Nasdaq 100 retreated -0.33%. December E-mini S&P futures eased down -0.06%, with December E-mini Nasdaq futures declining -0.26%.

Energy Surges on Geopolitical Tensions

Energy stocks stood out as one of the day’s biggest winners, climbing higher following WTI crude oil’s rise of more than 1%. This surge was triggered by President Trump’s announcement of an oil blockade targeting tankers entering and leaving Venezuela. Devon Energy led the advance, gaining more than 2%, while other oil majors including ConocoPhillips, Occidental Petroleum, Halliburton, Chevron, Diamondback Energy, and APA Corp all posted gains exceeding 1%.

The Venezuelan tensions sent ripples across commodities markets. Precious metals caught a bid amid escalating safe-haven demand, with silver reaching unprecedented all-time highs. Mining stocks rode this wave higher, adding to the day’s energy-driven momentum.

Homebuilders Face Headwinds

In contrast, homebuilding stocks finished lower across the board. Lennar led the declines with a sharp 3% drop after projecting Q1 new orders between 18,000 to 19,000 units—a figure that came in below the consensus estimate of 20,297. Other builders including DR Horton, PulteGroup, and Toll Brothers all fell more than 1%, reflecting broader weakness in the housing sector.

Rising bond yields added pressure to homebuilders. The 10-year Treasury yield climbed 2 basis points to 4.17%, partly stemming from spillover effects when Japan’s 10-year bond yield surged to an 18-year high of 1.98%. Japan’s fiscal concerns—including reports of a record 120 trillion yen budget proposal for fiscal 2026—weighed on global bond markets and elevated mortgage rates. The average 30-year fixed mortgage rose 5 basis points to 6.38%.

Fed Official Offers Dovish Support

Fed Governor Christopher Waller provided some relief with dovish commentary, noting that the U.S. labor market shows “pretty soft” conditions with near-zero job growth. He emphasized that inflation remains anchored around 2% and that interest rates sit 50-100 basis points above neutral levels, allowing for steady rate reductions without urgency. His remarks offered modest support to both equities and bonds.

MBA mortgage applications declined 3.8% for the week ending December 12, with purchase applications down 2.8% and refinancing applications falling 3.6%.

Mixed Signals Ahead

Coming into focus this week are key economic releases. Thursday will bring initial unemployment claims data (expected to fall 11,000 to 225,000), alongside November CPI figures anticipated at +3.1% year-over-year and core CPI at +3.0%. Friday’s calendar includes November existing home sales, projected to rise 1.2% month-over-month to 4.15 million units, and the University of Michigan’s December consumer sentiment index revision, expected to show a +0.2 point improvement to 53.5.

Markets are pricing in just a 24% probability that the Federal Open Market Committee will cut the fed funds target by 25 basis points at its January 27-28 meeting.

Notable Individual Stock Movers

Jabil Inc emerged as a top gainer, surging more than 6% after reporting Q1 net revenue of $8.31 billion, beating consensus at $8.04 billion, and raising its 2026 revenue forecast to $32.4 billion from $31.3 billion. Lithium plays moved higher as Albemarle climbed more than 4% amid sustained demand expectations. Lumentum Holdings and Coherent Corp each gained more than 4% following analyst upgrades from Morgan Stanley. Texas Pacific Land jumped more than 3% on a strategic data center partnership announcement with Bolt Data & Energy.

Netflix edged higher by more than 2% as Warner Bros. Discovery signaled plans to reject Paramount’s acquisition bid. That rejection sent Paramount Skydance down more than 4% to lead the S&P 500’s losers for the session.

On the downside, Bally’s Corp plummeted more than 8% following a Barclays downgrade to underweight. Progressive Corp fell more than 3% after November net premiums written dropped 12% month-over-month. Oracle declined more than 3% on reports that Blue Owl Capital is stepping back from a $10 billion data center deal. Worthington Enterprises, Brown-Forman, and Fortinet all finished lower, each posting declines exceeding 1% on earnings misses or analyst downgrades.

Global Markets Mixed, Rates Under Pressure

Overseas, the Euro Stoxx 50 finished down 0.21%, while China’s Shanghai Composite closed up 1.19% and Japan’s Nikkei recovered to close up 0.26%. Treasury securities faced headwinds from Japanese bond weakness and steepening yield curve dynamics following the Fed’s recent announcement of $40 billion monthly purchases of short-term T-bills. The 10-year German bund yield rebounded to 2.858%, while UK gilt yields fell to 4.469%.

Eurozone inflation data showed November CPI revised down to 2.1% year-over-year, and Q3 labor costs decelerated to 3.3% year-over-year. UK CPI eased to 3.2% year-over-year, marking the slowest pace in eight months.