2025 | November 24

The Markets

Tech Pullback



The NASDAQ sustained its third consecutive weekly decline as doubts resurfaced about the resilience of this year’s AI-fueled market rally. The index finished the week down 2.7%; with more modest weightings in tech stocks, the S&P 500 and the Dow posted smaller declines of just under 2.0%.

Yields of U.S. government fell on Friday after a speech by one of the U.S. Federal Reserve’s voting members lifted investor expectations for a rate cut at the Fed’s meeting concluding on December 10. The yield of the 10-year U.S. Treasury finished at 4.06%, down from 4.15% at the end of the previous week. 

A week after falling into a bear market, the price of the most widely traded cryptocurrency fell further, sinking to the lowest level in seven months. Bitcoin was trading around $85,000 on Friday afternoon, down from its record price of about $125,000 reached in early October. 

A gauge that tracks investors’ short-term expectations of U.S. stock market volatility surged, accelerating a rise that began the previous week. The CBOE Volatility Index (VIX) climbed as high as 28 in trading on Thursday before pulling back to close around 23 on Friday. The figure was up from the prior week’s closing VIX level of just below 20. 

Shifts in the outlook for an interest rate cut at the next U.S. Federal Reserve meeting fueled market volatility. Friday afternoon’s prices in rate futures markets implied a nearly 72% probability that the Fed would cut by a quarter point at its meeting concluding December 10, according to CME FedWatch. Just two days earlier, traders had been pricing in a roughly 30% likelihood of a December cut.

A long-delayed jobs report issued on Thursday showed that recent labor market weakness eased in September, before the government shutdown. The U.S. economy generated 119,000 new jobs, more than double the figure that most economists had forecast. However, unemployment rose to 4.4%, the highest since October 2021.

As earnings season wrapped up, FactSet reported that the overall net profit margin for America’s largest companies rose to the highest level since the research firm began collecting margin data in 2009. Companies in the S&P 500 reported an average third-quarter margin of 13.1%, above the previous record of 13.0% set in the second quarter of 2021. The margin has now increased for seven quarters in a row. 

The backlog of U.S. economic data resulting from the recent government shutdown continued to leave investors and policymakers guessing ahead of the Thanksgiving holiday, which will further disrupt the release schedule. The unemployment rate and the Consumer Price Index for October won’t be released because data couldn’t be collected. The government also hasn’t issued a third-quarter GDP estimate.    

Source: John Hancock Investment Management

New 401k & IRA Contribution Limits for 2026

The IRS recently announced the increased 401k and IRA contribution limits for 2026.

Workers will be able to put up to $24,500 into their 401k and similar workplace retirement accounts in 2026, up $1,000 from this year. For IRAs, the maximum contribution will rise to $7,500 in 2026, from $7,000.

Limits on 401k and IRA contributions are higher for older workers.

For 401k’s, people 50 and older will be able to contribute an extra $8,000 in 2026, for a total of $32,500. Those age 60 to 63 will be able to contribute even more, for a total of $35,750.

For IRAs, those 50 and older will be able to contribute an extra $1,100. The IRA catch-up contribution – long $1,000 – is now being adjusted for inflation under a provision of a 2022 law.

That law also ushers in a change affecting 401k catch-up contributions for high earners.

Under it, those who earned more than $145,000 in 2025 generally must funnel their 401k catch-up dollars into an after-tax Roth 401k account.

Many higher earners try to max out contributions to traditional 401k accounts to benefit from the upfront tax deductions they offer. Ordinary income tax applies to withdrawals, and many assume they will be in lower tax brackets by the time they are retired and taking money out of the accounts.

The Roth requirement for high earners’ 401k catch-up dollars doesn’t apply to IRAs.

In some 401k plans, workers are able to save as much as $70,000 a year. That is usually the result of big matching contributions from employers or a provision allowing workers to make after-tax contributions.

Next year, that total will rise to $72,000, with those eligible for catch up contributions able to put in up to $11,250 more, depending on their age.

Source: WSJ

The Gift Shift

The holiday shopping season gets underway this week, and expectations are high. The National Retail Federation (NRF) looks at a bunch of economic factors – consumer spending, disposable personal income, employment, wages, inflation, and monthly retail sales – to estimate how much people will spend over the winter holidays. This year, the forecast suggests sales will top $1 trillion.

“American consumers may be cautious in sentiment yet remain fundamentally strong and continue to drive U.S. economic activity…We remain bullish about the holiday shopping season and expect that consumers will continue to seek savings in nonessential categories to be able to spend on gifts for loved ones,” explained NRF President and CEO Matthew Shay.

The Gift Shift

The Currency reported on a recent survey, called the Going Rate, that explored how Americans think about gift giving and spending. When responses were tallied, it found that:

86%       Believe gifts can be meaningful without being expensive.

75%       Expect gifts will be more expensive this year because of tariffs and inflation.

60%       Think gift culture has gotten “out of hand”.

58%       Have a gift budget.

56%       Buy gifts throughout the year to spread out the cost.

48%       Experience gift fatigue.

33%       Are adopting no-gift policies.

55% of millennials, 50% of Gen Z, and 28% of baby boomers would rather give the gift of time and shared experience. They believe their presence is the real gift. Respondents who plan to give gifts expect to spend about $64 per person, on average.

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eMoney

Charles Schwab

Advyzon

Emily Triano

Operations Manager

emily@ajadvice.com

Maya Laws

Operations Associate

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