Vigo, Galicia, Spain
It looked like being a down week in the US equity markets until a late surge on Friday lifted the SPX (S&P 500 Index) back into the 6700-6900 range where it has been consolidating for a few weeks:
Volume was extremely high on Friday (~ 2x average) and yet there was not a lot of price movement with the 6900 price level continuing to provide significant resistance as we go into the seasonal “Santa Clause Rally” period of historically bullish trading through the next 2 weeks. Although the SPX closed the week relatively unchanged, the heavily tech weighted NASDAQ (QQQ) was ~0.6% higher while Small-Cap stocks (IWM) closed ~1.2% lower than last week’s close.
Relative to other major asset classes:
S&P 500 stocks did not fare as well as international equities and Gold continued it’s strong 2025 performance, showing 65% Year-To-Date gains.
Since I am still planning to move to a new algorithm to manage the Darwin Portfolio in 2026 I have not made any adjustments other than to pick up dividends from EEM (Emerging Market ETF):
Performance still continues to track the benchmark AOA Fund even though I am only ~50% invested:
As for the past 2-3 weeks I do not plan on making adjustments before moving to the new algorithm for 2026.
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David,
Relative to you comment about consolidation, the general direction of price movements in SPX (or IVV, VOO, …) can partially be explained by price movements in NVIDIA. NVIDIA’s price the middle of last week was about the same as its price toward the end of July. Added to that, Apple has been increasing in value lately, while Microsoft has been declining, offsetting each other. The three together make up over 20% of the S&P 500.
As an aside, I’ve been shifting to international funds, particularly value funds, which have been doing quite well lately. I’ve been using Dimensional and Avantis funds.
As always, thank you for all you do for the ITA blog.
jim
Jim,
Thank you for your kind comments. Yes, the SPX has certainly been driven by the “Magnificant 7” large-cap tech stocks this year and this makes me nervous 🙂 . As I’ve mentioned in my posts, Metals (Gold or Silver) have been the best performers over the past 12 months (up over 70%) with International Equities also outperforming US equities almost 2:1 – so global diversification does seem to be in favor right now – despite the very respectable performance of the US markets.
Have a great holiday season and strap in for 2026 – Wishing you, and all readers of the ITA Wealth blog, a prosperous New Year.
David