The stock market staged a powerful comeback during the shortened holiday week, as expectations of a Federal Reserve rate cut at the Dec. 10 meeting soared, fueling broad-based gains across sectors.

The rally was ignited by a notable shift in tone from Federal Reserve officials. Several members openly signaled support for a 25-basis-point rate cut, flipping market sentiment that had, until last week, priced the odds of such a move at 50% or less. According to markets, those chances have now surged to nearly 90%.

Notably, the hawkish tone of Fed Chair Jerome Powell in October, when he said a December cut was "far from" guaranteed, appeared to be losing weight as his term draws to a close in May 2026.

Meanwhile, political chatter around Powell's successor intensified. Kevin Hassett, former White House economist and current head of the ...