The year ended on a down note for stocks Wednesday, but let's keep things in perspective here. Yes, the S&P 500 dropped for the fourth straight session, losing 0.74% to close at 6,845.50. Yes, the Dow tumbled more than 304 points to finish at 48,063.29. And yes, the Nasdaq slipped 0.76% to 23,241.99. But zoom out even slightly, and the picture looks pretty good.
The S&P 500 climbed 16.39% for the full year, notching its third consecutive year of double-digit gains. The Nasdaq did even better, jumping 20.36% in 2025. Even the Dow, which has been the relative laggard, still managed a respectable 12.97% gain for the year.
Market sentiment reflected the recent weakness, with the CNN Money Fear and Greed Index ticking down to 45.8 from 48.4. That keeps it firmly in "neutral" territory, suggesting investors aren't panicking but aren't exactly euphoric either. The index measures seven equal-weighted indicators to gauge whether fear or greed is driving the market, with readings ranging from 0 (maximum fear) to 100 (maximum greed).
Individual movers told different stories. Vanda Pharmaceuticals Inc. (VNDA) was the star of the day, rocketing more than 25% after announcing FDA approval of NEREUS for preventing motion-induced vomiting. On the flip side, FuelCell Energy Inc. (FCEL) dropped 8% after filing for an amended common stock offering, news that typically signals dilution ahead for existing shareholders.
On the economic front, jobless claims data came in better than expected. Initial claims fell by 16,000 to 199,000 for the week ending December 27, well below the 220,000 consensus estimate. That's a sign the labor market remains relatively healthy heading into the new year.
Wednesday's selloff was broad-based, with every sector in the S&P 500 closing in the red. Real estate, industrials, and materials stocks took the hardest hits, suggesting concerns about rate-sensitive and cyclical areas of the market.
