Stocks trade sideways after Congress passes stopgap spending bill

Markets have struggled to maintain their post-election momentum this month

article-image

meunierd/Shutterstock modified by Blockworks

share


This is a segment from the Forward Guidance newsletter. To read full editions, subscribe.


President Biden over the weekend signed Congress’s bipartisan spending package, narrowly avoiding a government shutdown and keeping federal operations funded through mid-March. 

The bill, cut from 1,500 pages to around 100, does not raise the debt ceiling, a provision President-elect Trump requested. Also out: a 3.8% raise for members of Congress, a bipartisan provision included in the original bill. 

The eleventh-hour deal did little to calm markets, which have struggled to maintain their post-election momentum this month. The S&P 500 is down 1.7% since the start of December. The tech-heavy Nasdaq has fared better, gaining 1.4% month to date, but the index lost almost 3% last week alone. 

The dip, which Sevens Report Research founder Tom Essaye attributes to hawkish commentary from the Fed, political turmoil and disappointing initial jobless claims data last week, could be a “potential preview” for the new year

“Now, to be clear, while I say that, I’m also not saying I expect the market to decline next year,” Essaye added. 

“Instead, I think last week was a preview of 2025 because it was a realization of what I have been warning about: Namely that uncertainty around the key drivers of this bull market is going to rise and we saw that last week with two of the drivers of rally, expectations for Fed rate cuts and pro-growth policies.” 

The S&P 500 and Nasdaq Composite were trading fairly flat midway through Monday’s session, up 0.6% and 1%, respectively, as of 2:15 pm ET. Market moves are expected to be relatively soft this week with a limited number of trading days. 

Meanwhile, bitcoin has also stalled. The largest digital currency is down around 13% from its all-time high of more than $108,000. 

Historically, cryptos deliver mixed returns in the final days of the year. When trying to predict what might happen this week, analysts say keeping an eye on macro conditions will be key. 

“While reduced liquidity can heighten volatility, the absence of major institutional activity may actually stabilize prices,” James Toledano, chief operating officer at Unity Wallet, said. “This year, much depends on investor sentiment following 2024’s ETF approval and the Trump-factor as well as other macro trends.”


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template (11).png

Research

Union’s technical design brings measured improvements to crosschain interoperability. By combining a consensus-verified hub with novel constructs like state lenses and ZK proofs for client updates, Union achieves an interoperability protocol that is highly performant, trust-minimized, and scalable.

article-image

The US regulator will use Nasdaq’s system to detect manipulation across derivatives and prediction markets

by Blockworks /
article-image

SOL and HYPE have rebounded, dYdX course corrects (again)

article-image

Over 100 crypto firms and advocates urge Congress to shield open-source builders and non-custodial providers

by Blockworks /
article-image

The probabilities app is finding mainstream success

article-image

A stock by any other name — even “token” — is still a security

article-image

“Diverse opportunities emerge alongside macroeconomic tailwinds,” zondacrypto CEO says