Fed minutes split drove repricing

December 17, 2025 at 21:00 UTC

6 min read

Fed minutes split and Waller's remarks cause US equities and Treasuries to decline

Key Points

Fed minutes showed a split on the pace of 2026 rate cuts, prompting market repricing toward at least one cut and shifting Treasury and rate-sensitive positioning.
Governor Christopher Waller's remarks that policy remains restrictive but allows gradual easing weighed on risk appetite and contributed to US equity weakness and sector underperformance.
The Bank of Thailand's 25bp cut to 1.25% placed downward pressure on the THB and short-term Thai yields, supporting regional asset flows in Asia.
The ECB's proposal to extend Frank Elderson's supervisory mandate reduced near-term governance uncertainty for euro-area banks and eased bank-governance headlines that had weighed on European markets.
Company deals drove marked moves: Hut 8's 15-year River Bend lease with Google's backstop materially repriced HUT, while Jabil's stronger Q1 and raised outlook lifted electronics names.

Global Market Summary

US equities closed lower as Fed minutes and Governor Christopher Waller's remarks on a gradual path for cuts weighed on risk appetite: the Dow (DJIA) fell 0.36% and the Nasdaq (^IXIC) declined 1.49%. European markets were mixed, with the FTSE (UKX) up 0.92% while the CAC (FRA40) and DAX (DAX) slipped 0.25% and 0.48% respectively amid cautious bank‐governance and policy headlines. In Asia the Shanghai Composite (000001.SS) gained 1.19% and the Hang Seng (HSI) rose 0.92% as regional central‐bank moves and corporate developments supported local flows.

Top Movers

Sectors: XLE (2.39%) led gains while VGT (-1.87%) and XLI (-1.56%) were the weakest. Notable winners included TTC (10.01%), HUT (9.17%) and TPL (8.53%). Notable losers included BE (-12.40%), FLNC (-11.94%) and GSAT (-11.88%).

Macro highlights

Fed minutes showed a split over the pace of 2026 rate cuts and Fed Governor Christopher Waller said policy remains restrictive but allows for gradual easing, which supported repricing toward at least one cut and influenced Treasury and rate‐sensitive positioning. The Bank of Thailand cut its policy rate by 25bp to 1.25%, placing downward pressure on the THB and short‐term Thai yields. The ECB proposed extending Frank Elderson's supervisory mandate, reducing near‐term governance uncertainty for euro‐area banks.

News that moved markets

Hut 8 signed a 15‐year lease with Fluidstack for 245 MW at River Bend, with Alphabet‐owned Google (GOOG) providing a financial backstop and project financing expected to be led by J.P. Morgan (JPM) with Goldman Sachs (GS) as underwriter; the announcement materially repriced HUT. Jabil (JBL) reported stronger‐than‐expected Q1 fiscal 2026 results and raised its full‐year outlook, prompting reported premarket gains and driving trading in electronics supply‐chain names. Comments from Fed Governor Christopher Waller about a gradual approach to cuts further influenced positioning in rate‐sensitive sectors. Nexans completed the acquisition of Electro Cables Inc., strengthening its low‐voltage solutions footprint in North America. Announced transactions included IFS's agreement to acquire Softeon and Wealth Enhancement's planned acquisition of Wealth Advocates, while Confie and ABM reported deals expanding insurance and semiconductor/technical services capabilities.

Upcoming session watchlist

GB BoE Interest Rate Decision — consensus 3.75% vs 4% prior, Dec 18, 12:00 PM | Sets Bank of England policy stance and influences gilt yields and sterling.
EA Deposit Facility Rate — consensus 2% vs 2% prior, Dec 18, 01:15 PM | Determines remuneration on banks' deposits at the ECB, affecting liquidity and funding.
EA ECB Interest Rate Decision — consensus 2.15% vs 2.15% prior, Dec 18, 01:15 PM | Sets ECB policy rate and signals stance for euro short-term interest rates.
US Core Inflation Rate YoY (NOV) — consensus 3%, Dec 18, 01:30 PM | Shows underlying inflation excluding food and energy, guiding monetary policy.
US Core Inflation Rate MoM (NOV) — forecast 0.2%, Dec 18, 01:30 PM | Tracks monthly underlying price changes, informing near-term inflation momentum.
US Inflation Rate MoM (NOV) — consensus 0.3%, Dec 18, 01:30 PM | Shows monthly headline price changes, indicating inflation momentum.
US Inflation Rate YoY (NOV) — Dec 18, 01:30 PM | Indicates headline inflation trend and consumer price pressures.
JP Inflation Rate YoY (NOV) — forecast 2.9% vs 3% prior, Dec 18, 11:30 PM | Signals Japan's headline inflation trend and consumer price pressures.

Key Takeaways

US equities closed lower as Fed minutes and Waller's remarks weighed on risk appetite, with the Nasdaq underperforming and the Dow also declining.
Energy led sector gains while technology and industrial ETFs underperformed, mirroring XLE's advance and VGT/XLI weakness among sector movers.
Asian markets advanced as regional central-bank moves and corporate developments supported flows, leaving Shanghai and the Hang Seng with session gains.
Company-specific announcements and M&A activity produced volatile movers, with HUT, TTC and TPL among top gainers and BE, FLNC and GSAT among the largest decliners.