[US Stock Market] Will Santa Come? Analysis of Q3 GDP and Year-End Volatility

[Emergency Check on December US Market]

It is already the last month of 2025. Carols are ringing in the streets, but the hearts of us 'Seohak Ants' (individual investors) don't seem to be merely fluttering with excitement. It is because of the Wall Street anticipation that visits around this time every year, the 'Santa Rally'. Will Santa Claus truly visit us with a heavy bag of gifts this year? In this post, we check the possibility of a Santa Rally by analyzing the aftershocks of the Q3 GDP announcement that recently heated up the market and the trends in year-end volatility.

US Stock Market, Will Santa Come? Seeking a Path Between GDP and Volatility

1. The Rollercoaster Year of 2025, and Q3 GDP

Looking back, 2025 has been quite an eventful year. Unlike the expectations at the beginning of the year, the war against sticky inflation lasted longer than anticipated, and the high-interest rate environment left scars throughout the US economy.

In particular, the US 2025 Q3 GDP growth rate announced last month caused quite a stir in the market. As soon as the result came out slightly below market expectations, the New York stock market plunged, engulfed in the fear of a 'recession.' However, a few days later, as detailed indicators were analyzed, reinterpretations such as "US consumption is still solid" and "Corporate investment is not bad" emerged, and the market showed a rebound.

In this way, the Q3 GDP was like a mirror reflecting the current US economic situation walking a tightrope between 'Recession' and 'Soft Landing', rather than showing a clear direction. This ambiguous report card is one of the biggest causes of the December volatility we are experiencing now.

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2. Why is the US Market Shaking So Much in December?

Looking at the US stock screen while losing sleep these days makes me feel dizzy. One day it soars as if Santa has arrived, and the next day it cools down coldly as if nothing happened. The year-end volatility appearing now has complex reasons.

• Uncertainty of Economic Indicators: As interpretations of indicators like the aforementioned GDP are mixed, investors are maintaining a 'wait-and-see' approach.
• Institutional Book Closing: Due to the nature of the year-end, trading volume itself has decreased as Wall Street institutional investors close their accounting books.
• Thin Market: In a market with low trading volume, even a small piece of news has the effect of making stock prices swing much more significantly than usual.

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3. Looking Towards 2026, the Key to the Santa Rally

Then, the most important question: Will the Santa Rally really come to the US stock market this year? Experts' opinions are split, but those expecting a positive scenario are betting on 'expectations for the future.'

Prerequisites for Santa's Arrival

• A Clear Dovish Signal from the Fed: They must provide a belief that the high-interest rate trend that pressured the market throughout 2025 will definitely break in 2026. If a concrete hint comes out at the December FOMC, the market will cheer.
• Confident Corporate Guidance: If major companies show confidence that "Profits will increase next year (2026)" in the upcoming Q4 earnings season preview, investor sentiment could recover quickly.

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4. Conclusion: Finding Balance on a Shaking Ship

Investors, it would be perfect if Santa Claus unpacks a bag of gifts, but I hope you won't be too disappointed even if he comes empty-handed or a little late. In waves of high volatility like this, it is easy to lose the direction of where your ship is heading.

In times like this, rather than swinging with short-term fluctuations, an attitude of calmly checking whether the intrinsic value of the companies you invested in has been damaged is necessary. The true Santa of investment eventually visits investors who keep their principles unwavering.

Key Summary:
The US stock market at the end of 2025 is experiencing high volatility due to mixed indicators like GDP and thin trading volume. However, if expectations for interest rate cuts in 2026 and corporate earnings guidance are confirmed, the possibility of a Santa Rally remains open.

The content of this blog is for reference only for investment judgment, and investment decisions must be made under the individual's own judgment and responsibility. Under no circumstances can the information in this blog be used as evidence of legal responsibility for investment results.