Stocks Rebound After CME Turmoil, Wiping Out November’s Declines

US equities pushed higher in light post-holiday trading, shaking off a technical disruption at the Chicago Mercantile Exchange that briefly unsettled the futures landscape. Treasury yields drifted slightly upward as bond prices weakened.

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The S&P 500 climbed 0.5% in the shortened Friday session, pulling back within range of its record peak. With markets closing at 1 p.m., turnover was subdued more than 25% below the recent 30-day average. Earlier in the morning, a data-center malfunction forced the CME to halt trading across several futures and options markets, an interruption that lasted longer than a comparable outage back in 2019.

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Tech stocks outperformed, lifting the Nasdaq 100 by 0.8%, helped by a strong gain from Intel Corp. Amazon.com Inc. advanced 1.8%, while Walmart Inc. set a new all-time high on what is historically one of the most active U.S. shopping days of the year.

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Currency trading, which remained open during the turmoil, saw limited volatility once the EBS platform resumed operations at 7 a.m. local time.
“The lingering holiday effect and the absence of meaningful U.S. data releases likely reduced the broader market impact,” noted Daniel Noorian, head of execution and quantitative services at Liquidnet.

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CyrusOne, the operator of the affected facility, said the CME’s outage stemmed from a cooling-system failure at a Chicago-area data center.
“Some traders may try to exploit price dislocations, but most will step back until the situation stabilizes,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM. “Acting too quickly in this environment risks unnecessary losses.”

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Despite the disruption, U.S. stocks held firm as expectations for faster-than-anticipated Federal Reserve rate cuts continued to support sentiment late in the month.

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The market’s best weekly performance in five months capped a turbulent November, a period when stretched valuations among major technology names rekindled investor nerves. While the rebound extended the S&P 500’s winning streak to seven straight months, a shift toward defensive sectors particularly health care left the tech-heavy Nasdaq 100 with its first monthly decline since March.

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At one point this month, the S&P 500 had fallen as much as 4.7% as concerns about overheated tech valuations weighed on risk appetite. Before Friday’s outage, money markets were pricing in roughly an 80% probability of a December Fed rate cut.

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“For now, the data still fits a soft-landing narrative, and that helped fuel the equity rally into Thanksgiving,” wrote Tom Essaye of the Sevens Report. “But there are still plenty of uncertainties and with limited government data in recent months, investors may be underestimating potential economic weakness.”

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Essaye added that if next week’s indicators disappoint, December could see renewed defensive flows. With investors eager for fresh direction, upcoming releases such as Challenger, Gray & Christmas job-cuts data, the ADP private-payrolls report, and the Fed’s preferred inflation gauge on Friday will carry added weight.

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Globally, equity moves were relatively subdued as trading liquidity thinned. Europe’s Stoxx 600 inched up 0.2%, while a regional Asian benchmark pulled back slightly after a four-day rally. The 10-year Treasury yield ticked up to 4.02%, and the dollar held stable against major peers.

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In commodities, oil prices were poised to log a fourth straight monthly decline as traders looked toward the upcoming OPEC+ gathering and considered how potential progress on a Ukraine peace agreement might influence an already oversupplied crude market.

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Gold markets experienced their own bout of volatility as the CME outage rippled through futures and options trading key tools for hedging exposure to London pricing. Once normal activity resumed, spot gold regained its footing and climbed more than 1%.

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Key market moves:

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Stocks
• S&P 500 gained 0.5% as of 1 p.m. in New York
• Nasdaq 100 advanced 0.8%
• Dow Jones Industrial Average rose 0.6%
• MSCI World Index added 0.5%

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Currencies
• Dollar Spot Index slipped 0.1%
• Euro held near $1.1602
• British pound was steady at $1.3235
• Japanese yen hovered around 156.23 per dollar

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Cryptocurrencies
• Bitcoin fell 0.8% to $90,683.70
• Ether edged up 0.1% to $3,037.02

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Bonds
• U.S. 10-year Treasury yield increased three basis points to 4.02%
• Germany’s 10-year yield was unchanged at 2.69%
• U.K. 10-year gilt yield dipped one basis point to 4.44%

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Commodities
• West Texas Intermediate crude gained 1.4% to $59.47 per barrel
• Spot gold rose 1.4% to $4,217.17 an ounce

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