S&P 500 November 2025 Performance Analysis: Worst Since 2008

The S&P 500 has declined ~3.42% in November 2025 (from Nov3 close 6851.98 to Nov18 close6617.33) [0], marking its worst November performance since 2008. This decline is driven by liquidity tightness in short-term funding markets—repo rates remain high despite Fed cuts [4]—and investor caution, leading to a rotation to defensive sectors. Defensive sectors like Energy (+2.01%) and Utilities (+1.15%) outperformed, while cyclicals such as Consumer Defensive (-1.62%) and Consumer Cyclical (-0.94%) underperformed [0]. The 10-2 Year Treasury yield spread (0.53%) is below its long-term average (0.85%) [6], indicating ongoing market uncertainty.

1. Defensive Rotation
   : The shift to defensive sectors suggests investor caution but not panic—unlike 2008, when the S&P500 declined ~11.32% by Nov18 [2][3].
2. Liquidity Over Volatility
   : The decline is more tied to funding market stress than equity volatility alone, as highlighted by persistent repo rate highs [4].
3. Magnitude Context
   : While the worst since 2008, the 2025 decline is significantly smaller (3.42% vs.11.32% in 2008 up to Nov18), indicating less systemic risk [2][3].

• Risks
  : Persistent repo rate tightness may increase corporate funding costs, pressuring cyclical sector earnings [4]. Further declines in cyclical sectors (Tech, Consumer Cyclical) are possible if liquidity issues persist.
• Opportunities
  : Defensive sectors (Energy, Utilities, Healthcare) offer relative safety amid market uncertainty [0]. Monitoring Fed policy announcements for liquidity relief could present tactical opportunities.

The S&P500’s November 2025 decline (~3.42%) is the worst since 2008 but less severe. Defensive sectors outperform cyclicals, driven by liquidity concerns (high repo rates). Key metrics: Energy (+2.01%), Consumer Defensive (-1.62%), repo rates high [0][4]. Investors should monitor repo rates and Fed actions for future market direction.