Major equity indices lost ground in the first week of the new year, with the benchmark S&P 500 falling 1.03%, NASDAQ Composite Index down 1.52%, and the Dow retreating 0.67%.
U.S. stocks struggled to keep up after a technology-driven sell-off on the second-to-last day of the year.
“Markets ended the 2025 calendar year on a rather sour note. Even though the S&P 500 was up nearly 17% for the year, and even though the NASDAQ was up almost 21% thanks to optimism centered around AI, the final trading day of the market was weak,” Seeking Alpha analyst Daniel Jones said.
“After such a strong year, it wouldn’t be unthinkable that market participants decided to take some profits for tax purposes. After all, market valuations are sky high. And with the U.S. likely to enter into a recession in the next few months, it’s tempting to sell out at the top,” Jones added.
State Street Financial Select Sector SPDR ETF (XLF) pulled back by 1.24% during the week.
Interestingly, payment processors Mastercard (MA) (-2.82% to $563.13), American Express (AXP) (-2.71% to $372.73), and Visa (V) (-2.44% to $346.48) led megacap losers in the holiday-shortened week.
Property and casualty insurer Progressive (PGR) led the week’s largecap losers. The stock lost 6.83% to close at $212.12 on Friday.
Pinnacle Financial Partners (PNFP) and Robinhood Markets (HOOD) were the next on the list, shedding 6.12% and 4.34% of value, respectively.
Meanwhile, Futu Holdings (FUTU) and Bitmine Immersion Technologies (BMNR) were outliers.
FUTU stock added 8.37% to close the week at $178.46, with the share price movement propelled by an unusually strong trading volume on Friday.
On the other hand, BMNR gained 6.27% on a weekly basis to $31.19 as the Ethereum (ETH-USD) treasury company works on a charter amendment to increase its number of authorized shares.
Among the midcap stocks, Sezzle (SEZL) was down 11.53% to $65.15 as the stock rally related to $100M share buyback program and S&P SmallCap 600 inclusion fizzled out.
In the category, DigitalBridge (DBRG) was the top performer for the week. The stock was up 12.92% to $15.38 after SoftBank Group (SFTBY) (SFTBF) agreed to acquire the alternative asset manager for a total enterprise value of ~$4.0B.
Chaince Digital Holdings (CD) and Coincheck Group (CNCK) were the notable losers among the smallcap stocks.