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December Rate Cut Odds Slide, Take Stocks With Them.
RiskReversal Recap: Thursday, Nov 13th
RiskReversal Media
November 13, 2025
MARKET WRAP
A pretty ugly day across the board following the government re-opening as December rate cut odds fell, and stocks with it. December rate cut have now slipped below 50%. The early-week rotation that kept the indices steady to higher while the AI trade continued to unwind finally ran out of steam. Only defensive areas like staples, and utilities were spared today, with the Mag7+ leading almost everything else down with it, especially small caps. On the Day: SPX -1.7%, QQQ -2.1% and IWM -2.8%.
Elsewhere, yields were higher, but nothing shocking. The move we saw post Powell in treasuries probably already accounted for much of what we’re now seeing in Fed Fund Futures. The US10YY was higher today, but only to 4.12%. Adding insult to injury to the momentum trade, BTC fell back below 100k, now 98k. The dollar was slightly lower. The VIX got above 21 intraday before closing at 20. The CME Fed watch has Dec rate cut odds at 52%.
Notable Gainers: CSCO +4.6%, NKE +2.9%, MRK +1.7%, CVX +1.4%, COST +1.2%
Notable Losers: MSTR -7.2%, TSLA -6.6%, SHOP -6.5%, PLTR -6.5%, CEG -5.2%, AVGO -4.3%, AMD -4.3%, NVDA -3.5%, DIS -7.8%
After Hours: AMAT is down about -2.5% on earnings after the close. It was down -3.5% into the print.
Today’s MRKT Call: Guy, Dan, and Liz break down the market’s reaction to the end of the shutdown, sector rotations into healthcare and energy, the sell-off in momentum-driven AI names, and how recent job cuts and the upcoming FOMC blackout period could shape December rate cut expectations.
Today’s RiskReversal Pod: Dan welcomes Gene Munster to break down Nvidia’s upcoming earnings which could set the tone for the entire market into year end. Plus a recap of what we’ve seen from the Mag7 reports thus far, including current spending, cloud growth, and strategy at Microsoft, Meta, Amazon, Google, Apple and more.
MRKT MATRIX: TODAY’S TOP STORIES
Dow drops more than 800 for worst day in over a month (CNBC)
Markets no longer view the December rate cut as a sure bet, with Fed officials casting doubts (CNBC)
New foreclosures jump 20% in October, a sign of more distress in the housing market (CNBC)
October Jobs Report to Skip Unemployment Rate, Hassett Says (Bloomberg)
Big Tech’s Soaring Profits Have an Ugly Underside: OpenAI’s Losses (WSJ)
Wall Street cools on Oracle’s buildout plans as debt concerns mount: ‘AI sentiment is waning’ (CNBC)
Microsoft to Use OpenAI’s Custom Chip Work to Help In-House Effort (Bloomberg)
Zuckerberg Weighs Ideas for Too Many AI Data Centers (Bloomberg)
Waymo Launches Driverless Robotaxis on Freeways in First for US (Bloomberg)
WHAT’S NEXT?
Some pain once again in tech, the broader AI complex, and even down to small caps. That was the third straight down day for the QQQ’s even though the DJIA was making new highs yesterday on some rotations. The Mag7+ moved pretty much in unison to the downside today, a theme of late. NVDA, AVGO, and TSLA were the worst hit in the group.
The big story aside from the equity decline was the slide in rate cut odds. That put some fear into the day as they dipped below 50%, down from 65% yesterday and close to 90% a few weeks back. The drop today was sparked by a string of Fed speakers the past two days (Miran not included) emphasizing patience and data dependence. That’s even as the data itself remains unavailable thanks to the government shutdown. The White House added to the data uncertainty yesterday hinting that some missed reports might never be released. As Liz noted on today’s MRKT Call that may mean the heaviest batch of new data arrives in the Fed blackout period in the weeks leading up to the Dec meeting.
There’s also a bit of “sell the news” at play here. The shutdown resolution that sparked Friday’s sharp rebound and carried into Monday didn’t really have much downside to reverse in the first place. Traders who chased that move may simply be getting punished following that +3% bounce.
Looking ahead, we’ll get more Fed speak tomorrow, but still no PPI or Retail Sales — and no clear word yet on when those reports will finally start rolling in.
Short duration volatility got pumped today, with tomorrow’s SPX expected move nearly 1%:
Friday, Nov 13th
Schmid, Bostic, Logan
SPX expected move: 0.9%
TODAY’S EPISODES
Watch MRKT Call’s newest episode: Can Stocks Keep Rallying With or Without Tech?
Guy and Dan are live from Austin, joined by Liz remotely to break down today’s “sell the news” reaction to the end of the shutdown, plus the sector rotations we’d been seeing this week including into healthcare and energy. Liz notes that momentum-driven names in the AI trade may be testing some weak hands here. Then, the SoFi Weekly on recent job cuts into the December rate cut odds, with special note of the upcoming FOMC blackout period, starting December 1st, which will coincide with a flood of delayed economic data.
SoFi Weekly - x
John Butters / FactSet - x
Analysis - x
Watch RiskReversal Podcast’s newest episode: Gene Munster: Mega Cap Tech Q3 Earnings Takeaways
Dan Nathan and Gene Munster discuss upcoming earnings for Nvidia and the recent trends in the technology and AI domain for major companies including SoftBank's sell-off of Nvidia shares. They also wrap up Q3 earnings for the 'Mag Seven' tech giants such as Microsoft, Meta, Amazon, Google, and Apple. They address key points about Microsoft's Azure growth, Meta's controversial spending on AI, Amazon's financials amidst AWS growth, Google's AI-driven search improvements, and Apple's forthcoming AI developments. The market's recent shift favoring AI-related stocks and the debate over Amazon's strategic investments without their own AI models are also covered. They conclude by emphasizing the significant role of Nvidia's next report and its effect on AI market sentiment.
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