Tech Profit-Taking Slips Stocks as Iran Risks Rise

U.S. stocks slipped on year-end tech selling after record levels last week, with traders leaning on thin holiday liquidity. The S&P 500 closed at 6,905.74 (down 0.35%), the Nasdaq at 23,474.35 (down 0.50%), and the Dow at 48,461.93 (down 0.51%).

The catalyst was simple. Profit-taking concentrated in AI-adjacent megacaps as investors looked to lock in 2025 gains ahead of a light data week and Tuesday’s Fed minutes. Tech weakness mattered more than usual because it’s been doing the heavy lifting. The S&P 500 tech sector is up 24.5% in 2025, and Nvidia is up 39%, even after a 1%+ dip Monday, per CNBC’s market recap.

Meanwhile, the most crowded momentum trade of the month snapped back. Silver briefly touched $80/oz before sliding to roughly $70–$75/oz intraday, while gold fell more than 4%, according to precious-metals moves. Investors were also tracking China’s plan to replace silver export quotas with licensing starting Jan. 1, a supply-side shift cited in an AP update.

Positioning risk is back in focus into the last sessions of the year. If tech stabilizes, broader indexes can still grind higher. If Fed minutes read hawkish or liquidity stays thin, the same leadership concentration that powered 2025 can amplify downside.

Economists are heading into 2026 with a surprisingly upbeat baseline after 2025’s tariff shocks and shutdown disruptions. Goldman Sachs forecasts 2.6% real GDP growth in 2026 versus 2.0% consensus, helped by fading tariff drag, easier financial conditions, and an estimated $100B boost in tax refunds in H1, per Goldman’s 2026 outlook.

The immediate catalyst for this shift in tone is that key 2025 headwinds are no longer accelerating. Goldman estimates the average effective tariff rate rose 11pp in 2025 and shaved about 0.6pp from GDP in the second half. If tariff rates stay broadly stable, that drag should fade in 2026, while business tax provisions and prospective Fed cuts help activity.

Still, the labor market is the swing variable. Goldman expects unemployment to hover around 4.5% in 2026 after rising to 4.6% in November, and warns it could rise further if productivity-enhancing AI adoption comes faster or companies refocus on cutting labor costs, per the same forecast. That aligns with Bank of America CEO Brian Moynihan’s view that labor availability and planning uncertainty matter more than tariffs right now, while he also cautioned markets would react badly if the Fed’s independence is questioned as the chair transition approaches in May 2026, according to his CBS interview.

Next steps come quickly. Investors get another read on policy divisions via the Fed’s December meeting minutes, and macro watchers will keep triangulating between consumer resilience and labor cooling. The big risk is a policy mix that tightens labor supply while tariffs and AI keep cost and job anxieties elevated. Position for a 2026 base case of steady growth, but don’t ignore the labor-market tail risk.

Protests broke out in Tehran and other Iranian cities on Monday after the rial slid to a record low and prices kept climbing. The annual inflation rate reached 42.2% in December, while the currency traded around 1.42 million rials per dollar at its worst and about 1.38 million on Monday, according to Associated Press reporting carried by CNN.

The immediate catalyst was household pain colliding with visible market stress. Shopkeepers and traders reportedly shut stores in parts of Tehran’s bazaar districts, and police used tear gas in some areas. The political system also signaled urgency. Iran’s central bank chief Mohammad Reza Farzin resigned, and local media said Abdolnaser Hemmati was set to replace him, per The New York Times.

Why now. The slide is being driven by a mix of sanctions pressure and renewed conflict risk. The currency was around 32,000 per dollar at the time of the 2015 nuclear accord, but the deal unraveled after the U.S. withdrawal in 2018. More recently, the U.N. reimposed nuclear-related sanctions via a “snapback” mechanism in September, and markets remain jittery after June’s 12-day war involving Iran and Israel, as noted in the same AP account.

Likely next steps include short-term stabilization attempts. That could mean tighter FX controls, efforts to manage expectations around fuel prices and taxes, and a credibility test for the incoming central bank leadership as Parliament debates the 2026 budget. For readers, the key is contagion risk. A sharper Iran crisis can spill into energy markets and regional security, even if day-to-day global growth is resilient. Track whether protests broaden and whether policymakers can slow the FX slide without choking domestic activity.

• Fed path clarity. Read Tuesday’s Fed minutes for how divided policymakers are after the last quarter-point cut.
• Tariff regime stability. Watch whether tariffs keep clustering near 15% as Moynihan’s de-escalation view holds into Q1 negotiations.
• Labor cooling vs growth. Track unemployment around 4.5% after Goldman’s 2026 call highlights growth with stagnant jobs.
• Metals volatility. Follow silver and gold after the $80 silver reversal and shifting margin and supply expectations.
• Iran stress signals. Monitor whether protests and FX turmoil broaden and spill into regional risk pricing.