Morning Market Snapshot – November 21, 2025
Wall Street is attempting to stage a recovery this morning, licking its wounds after a bruising Thursday session where the “sell the news” reaction to Nvidia’s earnings dragged the Nasdaq down over 2%. As of 7:45 AM EST, stock futures are flashing green, with the S&P 500 up 0.3% and the Dow Jones Industrial Average climbing 0.2%. The tech-heavy Nasdaq 100 is fighting to reclaim positive territory, up a modest 0.1%.
Two divergent narratives are dominating the pre-market tape. First, the “AI Trade” is undergoing a stress test. Despite Nvidia posting a record $57 billion in revenue, the stock’s inability to hold gains has forced a “healthy correction” mentality across the semiconductor sector. Second, a surprise geopolitical pivot is softening inflation fears: reports that the U.S. is actively pressing for a Russia-Ukraine peace deal have sent crude oil prices tumbling nearly 2% to around $58 per barrel.
Traders are navigating a complex liquidity environment. While the 10-year Treasury yield has stabilized near 4.08%, the crypto markets are in turmoil, with Bitcoin plunging to seven-month lows near $86,400, signaling a sharp “risk-off” flush in speculative assets.
Pre-Market News Catalysts
- Semrush Holdings (SEMR): The marketing tech stock is exploding ~70% higher in pre-market action following news that Adobe (ADBE) has agreed to acquire the company in an all-cash deal valued at $1.9 billion ($12/share). The acquisition is seen as a major play by Adobe to bolster its GenAI marketing capabilities.
- The Gap, Inc. (GAP): Shares are surging ~5.6% after the retailer delivered a convincing Q3 earnings beat. Gap reported EPS of $0.62, topping estimates of $0.58, driven by inventory discipline and strength in its Old Navy division. The results are a beacon of hope for the “resilient consumer” thesis.
- Nvidia Corp. (NVDA): The AI bellwether remains volatile, trading down ~1.5% pre-market after closing down 3% yesterday. Despite issuing guidance that beat expectations, the market is grappling with “perfection fatigue,” as the stock struggles to justify its valuation multiples amidst a broader rotation.
- SoftBank Group (SFTBY): The Japanese investment giant is sliding ~11% in global trading, acting as a drag on sentiment. The drop is linked to broader tech weakness and exposure to speculative AI ventures that are facing scrutiny in the current risk-off wave.
The Day’s Debate (The Bull vs. Bear Case)
The Bull Case: A Rational Reset & The “Peace Dividend”: Optimists view Thursday’s sell-off as a necessary clearing of the decks. Daniel Grosvenor, Director of Equity Strategy at Oxford Economics, argues that the IT sector drawdown represents a “healthy correction rather than the start of something more threatening,” citing robust earnings momentum as a floor for prices. Bulls are particularly encouraged by the collapse in oil prices (down to $58) driven by the Russia-Ukraine peace talk rumors.
They argue this “Peace Dividend” acts as a massive tax cut for consumers and corporations alike, potentially solving the Fed’s inflation headache without further rate hikes. With retail earnings (Gap, Ross) showing that the American shopper is still spending, the “soft landing” narrative remains intact.
The Bear Case: The Liquidity Drain & Crypto Contagion: Pessimists warn that the “AI Bubble” is leaking, and there is no backup generator for market breadth. The stunning collapse in Bitcoin, which has shed nearly $30,000 from its highs to trade in the $80,000s, is flagged as a leading indicator of a liquidity crisis. Bears point to the unexpected tick-up in the unemployment rate to 4.4% as evidence that the labor market is cracking faster than the Fed can react.
Furthermore, with the probability of a December rate cut plummeting to 35% (down from 90% a month ago), the “higher for longer” reality is finally biting. If the peace talks stall and oil rebounds, the equity market could find itself trapped between slowing growth and sticky inflation.
The Strategic Takeaway
The primary objective for traders today is to identify relative strength outside of Big Tech. The “Peace Deal” narrative is a potential game-changer for energy importers and consumer discretionary stocks, watch for airlines and retailers to outperform if oil remains suppressed.
However, caution is warranted. The divergence between plunging crypto prices and stabilizing equities is a tension that usually resolves with one side capitulating. If Bitcoin fails to reclaim the $90,000 level, expect risk appetite to remain fragile. Do not blindly buy the dip in semiconductors until Nvidia can close a session near its highs; until then, the path of least resistance for high-beta tech remains lower.
Upcoming Session Outlook
Directional Bias: Slightly Bullish (Relief Rally)
Expect a “relief bounce” at the open as traders cover shorts ahead of the weekend, fueled by the Adobe M&A news and falling oil prices. However, upside will likely be capped by the technical damage inflicted on the Nasdaq yesterday. The session is likely to close green, but with low conviction.
Disclaimer: This article is for informational purposes only and does not constitute financial, investment, or legal advice. The information provided is a synthesis of publicly available data and expert analysis and should not be considered a recommendation to buy or sell any security. Investing in the stock market involves risk, including the possible loss of principal. Past performance is not indicative of future results. Readers should consult with a qualified financial advisor to determine an investment strategy that is suitable for their own personal financial situation and risk tolerance.
