October 3, 2025
S&P futures +0.2% following Thursday’s gains, when the Dow, S&P, and Nasdaq all closed at fresh record highs. Leadership came from most-shorted stocks, semis, China tech, managed care, machinery, credit cards, and travel/leisure, while EVs, pharma, biotech, media, telecom, entertainment, and credit bureaus lagged.
Overnight, Asian markets traded mostly higher, with Japan up nearly 2% after the BoJ avoided signaling explicit tightening. Many regional bourses remained closed for holidays. European equities were modestly firmer, up ~0.2%. In markets, Treasuries were flat to slightly weaker, the dollar index was steady, gold gained 0.4%, Bitcoin slipped 0.2%, and WTI crude rose 1% but remained down ~7% for the week.
Macro focus remains on the catalyst vacuum created by the government shutdown, with investors leaning on Fed easing expectations and confidence that the labor market slowdown is temporary. AI momentum remains a key tailwind amid new deal activity and anticipated hyperscaler capex disclosures during Q3 earnings season. Earnings themselves are seen as another positive catalyst, with the Street looking for ~8% growth and potential upside from FX, capital markets activity, consumer resilience, and tariff mitigation. Record inflows into global equity ETFs over the past three weeks highlight continued strong retail participation.
On the calendar, the September ISM Services index is the key release today (Street at 51.7 vs. 52.0 in August), with the BLS employment report delayed by the shutdown. NY Fed President Williams spoke Thursday on uncertainty in policymaking, while Fed Governor Jefferson is scheduled to speak this afternoon. Focus has also turned to the drop in U.S. bank reserves below $3T, seen as a potential driver of funding-market volatility. Next week brings a heavy Fedspeak slate (Bostic, Bowman, Miran, Kashkari, Musalem, Barr, Powell, Goolsbee) along with the September FOMC minutes. Treasury supply also looms with 3-, 10-, and 30-year auctions.
Corporate news was light.
- AMAT warned its October quarter and FY26 outlook will be negatively impacted by expanded U.S. export restrictions to China.
- NVDA was said to be frustrated by delays in finalizing its multibillion-dollar chip deal with the UAE announced in May.
- GOOGL is reportedly exploring a sale or spinoff of its life sciences unit, Verily.
- BA disclosed its 777X program will be delayed until 2027, resulting in a $2.5–4B charge.
- Looking ahead, the week of Oct 6 will see earnings from STZ, MKC, PEP, DAL and others.
U.S. equities closed modestly higher on Thursday (Dow +0.17% · S&P 500 +0.06% · Nasdaq +0.39% · Russell 2000 +0.66%), with the S&P 500, Dow, and Nasdaq all finishing at new record highs despite a lack of major macro catalysts. The move higher came amid a combination of Fed easing expectations, AI-driven semi/tech momentum, and optimism around upcoming Q3 earnings. The market continues to treat the government shutdown as more noise than news, though concerns are building as delays in official data releases (claims, NFP) complicate visibility and White House threats of mass federal worker firings add to policy uncertainty.
Labor data remained in focus after Wednesday’s weak ADP report. Challenger reported layoffs fell sharply in September (-37% m/m, -26% y/y), though hiring plans dropped nearly 60% y/y, the lowest level since 2009, keeping attention on softening employment dynamics. Light vehicle sales surprised positively at 16.4M SAAR, up just over 2% y/y, supported by strength in EVs. The Chicago Fed projected unemployment steady at 4.3%. On the Fed front, Dallas President Logan stressed the need to be “very cautious” on rate cuts, remarks that carried added weight in the absence of scheduled economic data.
In markets, Treasuries were unchanged to firmer at the long end, with the 30Y yield up ~2 bp. The Dollar Index rose 0.2%, while gold fell 0.8%, retracing part of September’s surge. Bitcoin gained 2.9%. WTI crude fell 2.1%, marking its lowest settlement since May 8, pressuring energy shares.
Sector & Company Highlights
Sector moves were mixed. Materials (+1.05%) led on upgrades in chemicals and continued momentum in lithium names, while Technology (+0.49%), Communication Services (+0.26%), and Industrials (+0.24%) posted modest gains on AI-related strength and corporate M&A. Energy (-1.02%) lagged on crude weakness and OXY’s takeout premium. Consumer Discretionary (-0.69%), Real Estate (-0.54%), and Staples (-0.52%) underperformed. Utilities (-0.20%), Healthcare (-0.19%), and Financials (-0.09%) also slipped.
Information Technology (+0.49%)
- TSLA – notable decliner: Despite beating on Q3 deliveries, shares fell on profit-taking after recent strength.
- AAPL: Reportedly pausing Vision Pro overhaul to focus on developing smart glasses to rival META.
- OpenAI: Completed share sale at a $500B valuation, now exceeding SpaceX.
- FICO +18%: Announced overhaul of credit score delivery with new direct-to-reseller model; triggered steep declines in TRU (-10.6%) and EFX.
- HON: Announced deal to divest legacy asbestos liabilities.
Healthcare (-0.19%)
- HUM +4.0%: Preliminary Medicare Advantage star ratings in line; reaffirmed FY25 guidance.
- Pharma/Biotech: Pulled back after strong multi-day rally led by PFE earlier in the week.
- ABSI +13.4%: JPMorgan initiation at Overweight on ABS-101 potential and pipeline upside.
Financials (-0.09%)
- Moneycenter banks, exchanges, and insurers lagged.
- Credit bureaus: TRU -10.6%, EFX weaker on competitive concerns after FICO’s pricing overhaul.
- Credit cards: Benefited from consumer resilience, supported group performance.
Industrials (+0.24%)
- WMB: Investing $3.1B in two new power innovation projects for grid-constrained regions.
- Machinery/Multis/Building products: Broader industrials outperformed on earnings momentum.
- Airlines: Strong session with travel & leisure themes, aided by better vehicle and EV demand backdrop.
Materials (+1.05%)
- LAC -2.6%: Downgraded after sharp DOE-driven rally; concerns about equity dilution.
- CE +7.0%: Upgraded at Citi on auto recovery and acetyl supply chain tailwinds.
- SHLS +12.4%: Upgraded at Barclays; noted data center and energy storage entry as new growth driver.
Energy (-1.02%)
- OXY -7.3%: To sell OxyChem to BRK.B in a $9.7B cash deal.
- WTI crude -2.1%, lowest since early May, pressured energy broadly.
- BRK.B: Confirmed as acquirer of OxyChem unit.
Consumer Discretionary (-0.69%)
- RIVN: Narrowed FY delivery guidance; midpoint below consensus.
- Restaurants, travel & leisure: Outperformed, offsetting weakness in retail-related names.
- Armani (privately held): Exploring stake sale, adding to M&A chatter in luxury.
Communication Services (+0.26%)
- META: Approved policy for ads tied to AI chats.
- RDDT -11.9%: DAUs down as citation changes impacted traffic.
- Perplexity AI: Announced global rollout of its Comet web browser.
Consumer Staples (-0.52%)
- MDLZ -2.4%: Downgraded at Berenberg on cocoa normalization and weaker European demand outlook.
- Grocers & HPCs: Broader staples weak on cost headwinds and cautious consumer backdrop.
Utilities (-0.20%)
- EIX -3.2%: Downgraded at Jefferies on wildfire risk and slower growth profile.
- Broader utilities weighed by defensives rotation and rising long-end yields.
Real Estate (-0.54%)
- REITs weaker, tracking rate moves and capital market caution.
Eco Data Releases | Friday October 3rd, 2025
S&P 500 Constituent Earnings Announcements | Friday October 3rd, 2025
No constituents report today
Data sourced from FactSet Research Systems Inc.
