Key Takeaways
- Oracle (ORCL) shares extended gains to 6% on December 18, buoyed by positive project updates and regulatory progress on its Michigan data center, despite recent investor anxiety over AI-related spending and financing challenges.
- President Donald Trump officially signed the Fiscal Year 2026 National Defense Authorization Act (NDAA) into law, authorizing a record $901 billion in military spending and including a 3.8% pay raise for troops.
- The Bank of Japan (BoJ) is set to raise its interest rates to a 30-year high of 0.75% on December 19, marking its second tightening move this year in response to sustained inflation above its 2% target.
Oracle Shares Rebound Amid Data Center Developments
Shares of Oracle (ORCL) saw an extended gain of 6% on December 18, reflecting a rebound and renewed investor confidence. This uptick followed a mix of positive project updates and short-term technical buying, which helped to offset recent anxieties regarding the company's significant AI-related spending and data center financing. Just the previous day, on December 17, Oracle's shares had slid by approximately 6% after reports surfaced that talks with private capital group Blue Owl Capital to finance a planned $10 billion data center in Michigan had stalled.
However, the latest developments indicate that Michigan regulators have unanimously approved utility support to power the planned data center, a substantive permitting win that reduces project execution risk. Furthermore, Oracle was named as an investor in a U.S. TikTok deal, a strategic minority investment that validates Oracle's role in large-scale tech transactions and may be seen as a vote of confidence by the market. The company's aggressive expansion in cloud infrastructure, particularly for AI workloads, remains a key driver for its stock performance, despite the substantial increase in its debt to fund these initiatives.
President Trump Enacts Record Defense Spending Bill
President Donald Trump officially signed the Fiscal Year 2026 National Defense Authorization Act (NDAA) into law on December 18, 2025, at the White House. The sweeping legislation authorizes a record $901 billion in annual military spending, exceeding President Trump’s request by $8 billion. This comprehensive bill dictates everything from the procurement of ships, aircraft, and missile systems to troop compensation and geopolitical threat responses.
Key provisions of the NDAA include a 3.8% pay raise for U.S. troops and $800 million in new aid for Ukraine over the next two years as part of the Ukraine Security Assistance Initiative. The act also authorizes the Baltic Security Initiative, providing $175 million to support the defense of Latvia, Lithuania, and Estonia, and places limits on the Department of Defense's ability to reduce U.S. forces in Europe. Notably, the legislation also codifies aspects of several of President Trump's executive orders, such as funding the Golden Dome missile defense system and eliminating diversity, equity, and inclusion (DEI) programs at the Pentagon. The bill, which passed Congress with a 77-20 vote, also officially ends the war in Iraq by repealing the authorization for the 2003 invasion.
Bank of Japan Poised for 30-Year High Interest Rate Hike
The Bank of Japan (BoJ) is expected to raise its interest rates on Friday, December 19, to a three-decade high. This move is anticipated to be a quarter percentage point increase, bringing the policy rate to 0.75% from its current 0.5%. This would mark the central bank's second tightening step this year, signaling its growing conviction that sustained wage gains will keep inflation durably around its 2% target.
The decision comes as Japan's core consumer prices rose 3.0% in November, remaining above the central bank's 2% target for the 44th consecutive month. BoJ Governor Kazuo Ueda's guidance on Friday will be closely scrutinized by global markets for clues regarding the central bank's appetite for additional tightening measures in 2026. While the Japanese yen was the worst-performing major currency against the U.S. dollar in 2025 despite earlier rate hikes, further tightening could attract foreign demand for Japanese government bonds (JGBs).
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.