Weekend Update #252
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U.S. stocks ended the week on a high note, with the S&P 500, Dow Jones, and Nasdaq all closing near record levels as earnings season began on a strong footing—roughly 86% of companies have beaten estimates so far, signaling resilience in the economy despite ongoing macro uncertainty. Sentiment was further lifted by a cooler-than-expected September CPI report, with headline inflation rising 0.3% month-over-month and 3.0% year-over-year, while core and supercore measures eased, reinforcing progress on disinflation and expectations for additional Fed rate cuts next week.
In other data, consumer sentiment weakened further in October, with the index falling to 53.6 from 55.0 in September as both current conditions and future expectations declined; while year-ahead inflation expectations held steady at 4.6%, long-term expectations inched up to 3.9%, reflecting persistent concerns about personal finances and the broader economy.
On the geopolitical front, President Trump is set to meet Chinese President Xi Jinping next week in an effort to reset relations amid renewed trade tensions, as his administration weighs new export restrictions and launches an investigation into China’s compliance with the 2020 Phase One trade deal. Separately, Trump temporarily halted trade negotiations with Canada after Ontario’s government aired an ad featuring Ronald Reagan’s 1987 speech opposing tariffs, though Premier Doug Ford has since agreed to pause the ads to allow discussions to resume.
Investors will turn their focus to a packed week of earnings, with most Big Tech firms set to report and provide insight into AI-related CapEx spending trends. Attention will also center on the Federal Reserve’s upcoming FOMC meeting, where policymakers are widely expected to deliver another 25 bps rate cut and signal the potential pace of future easing.
Friday’s Close
(Weekly Performance)
S&P 500 6,791.69 (+1.92%)
Nasdaq 23,204.87 (+2.31%)
Dow Jones 47,207.12 (+2.20%)
Thank you Blue Room Senior Analyst NICK PEART.
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