October 7, 2025
S&P futures flat in early Tuesday trading after U.S. equities finished mostly higher on Monday, extending the S&P 500’s winning streak to seven sessions. Leadership came from AI, semiconductors, technology, crypto, meme stocks, transports, aerospace & defense, China ADRs, and agricultural chemicals, while builders, staples, restaurants, and telecom lagged.
Asian markets were mostly higher overnight, led by Taiwan, while South Korea and Greater China remained closed for holidays. European markets traded narrowly mixed. Treasuries were steady, the Dollar Index rose 0.3%, gold gained 0.2%, Bitcoin slipped 0.7%, and WTI crude fell 0.5%.
From a macro perspective, the session remains extremely quiet. Yesterday’s hints of a potential path to end the U.S. government shutdown proved to be more noise than substance. Market attention continues to center on the AI investment cycle and related bubble debates, including its potential impact on productivity and the labor market. The upcoming Q3 earnings season is also a focal point, with expected strength in AI capex, tariff mitigation, and consumer resilience, offset by concerns over macro uncertainty, tariff-related cost pressures, and strain on lower-income consumers. The elevated retail impulse remains a prominent bullish narrative supporting the “melt-up into year-end” theme. So far, political developments in Japan and France have had limited market spillover.
On the economic calendar, the NY Fed inflation expectations and consumer credit data are due today. Fedspeak will be active but likely non-incremental in the absence of major data, with remarks expected from Bostic, Bowman, Miran, and Kashkari. Treasury will auction $58B in 3-year notes today. Looking ahead, September FOMC minutes arrive Wednesday alongside $39B in 10-year supply, followed by remarks from Musalem, Barr, and Kashkari. Thursday brings Powell (pre-recorded video), Bowman, Barr, Kashkari, and Daly, along with $22B in 30-year supply, while Friday’s highlights include University of Michigan consumer sentiment and inflation expectations plus comments from Goolsbee and Musalem.
Corporate news:
- TSLA expected to unveil a lower-cost Model Y at its event today.
- MKC reports before the open.
- DELL and ADSK host analyst days.
- XOM issued Q3 considerations noting larger-than-expected timing headwinds in its refining segment.
- F traded weaker after disruption from a fire at a major aluminum supplier.
- STZ posted better-than-feared FQ2 results, reaffirmed guidance, but warned of ongoing consumer demand headwinds.
- AMKR surged after announcing a new advanced packaging and test campus in Arizona.
- LCID deliveries came in slightly light for Q3.
- AMRC secured a $200M energy infrastructure contract with the U.S. Naval Research Laboratory.
- TMQ soared following a strategic investment from the U.S. government
U.S. equities climbed in a quiet Monday session (Dow -0.14% · S&P 500 +0.36% · Nasdaq +0.71% · Russell 2000 +0.41%), with the S&P 500, Nasdaq, and Russell 2000 setting fresh record highs as investors stuck with the “path of least resistance” amid a thin catalyst tape. Rates drifted higher (long-end +4–5 bp; curve steepening), the Dollar Index +0.4%, gold +1.7% to another record (just shy of $4,000/oz), Bitcoin +2.2%, and WTI +1.3% after a smaller-than-feared OPEC+ output increase. The bullish narrative remained anchored by expected Fed easing, a still-solid U.S. backdrop, and approaching Q3 earnings—with hyperscaler AI capex, tariff mitigation, and consumer resilience seen as key supports. The government shutdown stayed a background risk. Abroad, surprise political developments in Japan (LDP leadership outcome) and France kept pressure on the yen/euro and nudged global long yields higher.
Sector Highlights
Leadership skewed to Technology (semis strength on AMD/OpenAI), Communication Services, Consumer Discretionary, Energy, and Industrials. Laggards included Real Estate, Consumer Staples, Healthcare, and parts of Financials as larger-cap banks and exchanges underperformed.
Information Technology
- Semis/AI: AMD +23.7% on a multi-billion-dollar OpenAI partnership (6 GW buildout; OpenAI warrants up to ~10% stake). MU +1.7% upgraded at MS on DRAM/HBM tailwinds.
- Software/Infra: FIG, DASH, UBER, HUBS named among partners at OpenAI’s developer event.
- App economy: APP -14.1% on SEC data-collection probe report.
Communication Services
- Platform/Ads/AI: GOOGL reportedly exploring sale/spin of Verily; momentum bid across mega-cap comms.
- Telecom: VZ -5.1% as Hans Vestberg retires; former PayPal CEO Dan Schulman named CEO.
- Media: Risk-on tone aided select digital names; RUM strength tied to recent AI-search partnership (prior day).
Consumer Discretionary
- Autos/EVs: TSLA +5.4% on 7-Oct event tease (speculation on more affordable Model Y). STLA to invest $5B in U.S. to drive NA turnaround.
- Restaurants/Retail: SBUX -5.0% on store closures/layoffs headlines (“Project Bloom”). ANF -7.8% after downgrade.
- E-commerce/Travel: Risk-on bid supported discretionary broadly.
Financials
- Banks/IBs: FITB to acquire CMA +13.7% in an all-stock $10.9B deal (scale, Southeast/Southwest expansion, ~$850M synergies; no TBV dilution; 2027 EPS accretion). Larger-cap banks and exchanges lagged the tape.
- Alt managers/FinTech: KLAR +3.9% on multiple upbeat initiations.
Industrials
- A&D/Airlines/Rails: Group firm; BA to boost 737 MAX production as soon as this month. FLY +6.3% to buy defense contractor SciTec ($855M cash/stock).
- Machinery/Multis: Ongoing bid on cyclical momentum; MMM reportedly weighing asset sales in low-growth units.
Energy
- Crude & majors: WTI +1.3% (still tight supply increase from OPEC+); sector bid continued.
- Utilities/Power tie-ins: (See Utilities for data-center power agreements in prior sessions).
Utilities
- Broadly better with defensiveness and AI-power angles in focus.
Materials
- Ag chemicals/Metals: Group outperformed early; ag chemicals cited among winners.
- Paper/Packaging: IP -2.7% weaker on peer read-through and downgrade.
Health Care
- ABBV cut FY profit guidance (one-time $2.7B IPR&D charge).
- Biopharma/Medtech: Mixed; GLP-1 story remained a relative support for select names.
Real Estate
- REITs lagged alongside higher long-end yields.
Consumer Staples
- COST to offer member discounts on NVO’s Ozempic/Wegovy; SAM -4.2% downgraded on softer demand/cost headwinds.
- Beverages/Grocers: Underperformed amid margin and pricing scrutiny.
Eco Data Releases | Tuesday October 7th, 2025
S&P 500 Constituent Earnings Announcements | Tuesday October 7th, 2025
Data sourced from FactSet Research Systems Inc.
