Morning Brief

The US government has officially shut down after lawmakers failed to reach a funding deal, furloughing 750,000 workers and risking delays to jobs and inflation data critical for the Fed’s next moves. Markets opened Q4 lower, with futures and the dollar slipping while gold rallies toward $3,900 an ounce. ADP private payrolls fell 32,000, deepening concerns about a weakening labor market as investors now price in an October Fed rate cut with near certainty. Nike (NKE) rose after beating Q1 estimates but warned tariffs could cost $1.5B this year. Occidental Petroleum (OXY) gained after reports that Warren Buffett’s Berkshire Hathaway (BRK-B) is in talks to buy its petrochemical unit for $10B. Lithium Americas (LAC) jumped after the Department of Energy confirmed plans to take a 5% equity stake in the company and its Nevada mining project to boost domestic supply chains.

Takeaways:

US government shutdown begins, delaying jobs and inflation data

Gold nears $3,900 on safe-haven demand; Fed cut bets rise

Nike beats earnings but warns $1.5B tariff hit this year

Buffett’s Berkshire eyes $10B Occidental deal; DOE takes stake in Lithium Americas

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US stocks edge lower on the final trading day of Q3, with the S&P 500 (^GSPC) heading for its best September since 2010. According to Washington watchers, investors brace for a potential government shutdown as talks stall in Congress, with odds now above 90%. A shutdown would delay key economic data, furlough hundreds of thousands of workers, and risk disrupting the Fed’s October meeting. President Trump announced new tariffs: 10% on lumber and timber, plus 25% on wood furniture, set to take effect on October 14. Sector-specific levies on pharmaceuticals and semitrucks are also in the pipeline. Spotify (SPOT) fell after CEO Daniel Ek said he would step down and move to chairman, while two longtime executives would take over as co-CEOs. ExxonMobil (XOM) is cutting 2,000 jobs, about 3% of its workforce, as part of a global restructuring. CoreWeave expanded its business beyond Microsoft with a $14.2B AI infrastructure deal with Meta (META).

Takeaways:

Government shutdown odds top 90%; key data, Fed decision at risk

Trump tariffs expand to lumber, timber, and furniture imports

Spotify CEO Daniel Ek steps down; co-CEOs appointed

Exxon cuts 2,000 jobs; CoreWeave inks $14.2B deal with Meta

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US stocks open the week higher as investors brace for a potential government shutdown if Congress fails to pass a short-term funding bill by tomorrow night. A shutdown could delay key economic reports, including Friday’s jobs data, and the Trump administration has threatened permanent layoffs for federal workers. Electronic Arts (EA) agreed to go private in a $55B leveraged buyout, the largest LBO ever, sending shares higher. President Trump announced sweeping tariffs set to take effect this week, including 100% duties on foreign-made movies alongside earlier measures on pharmaceuticals, furniture, and trucks. CSX (CSX) CEO Joe Hinrichs abruptly resigned amid activist pressure, with Steve Angel named as successor. Pot stocks, including Tilray (⁠TLRY⁠) and Canopy Growth (⁠CGC⁠), rallied after Trump touted hemp-derived CBD for seniors.

Takeaways:

Government shutdown risk rises; federal worker layoffs possible

EA agrees to $55B buyout, marking the largest LBO in history

Trump tariffs expand to include 100% duties on foreign films

CSX CEO exits under activist pressure; pot stocks jump on CBD push

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US stocks edge higher after three straight down sessions as investors digest fresh tariffs, inflation data, and Fed commentary. President Trump announced sweeping new tariffs set to begin October 1: a 50% duty on heavy trucks and kitchen cabinets, and a 30% tariff on upholstered furniture. Pharmaceutical companies were spared if they build plants in the US, with Eli Lilly (LLY), Johnson & Johnson (JNJ), and Merck (MRK) all gaining on the news. Core PCE, the Fed’s preferred inflation gauge, rose 2.9% year over year in August, in line with estimates, keeping expectations for two more rate cuts this year intact. Investors also weigh the Fed’s divided stance, with officials split on how quickly to ease policy amid a fragile labor market. In trending tickers, Costco (COST) slips after earnings narrowly missed comps, Oklo (OKLO) falls on insider stock sales and Goldman’s neutral initiation, and Boeing (BA) climbs after the FAA signaled it will ease restrictions on 737 Max inspections and deliveries.

Takeaways:

Trump announces 50% tariffs on trucks, 30% on furniture; pharma spared with US plants

Core PCE holds at 2.9%, keeping Fed rate cut path alive

Costco misses comps, Oklo slides on insider sales, Boeing rises on FAA update

Fed split on pace of easing; labor market fragility in focus

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US stocks fall for a third straight day as the summer rally cools, even after revised Q2 GDP showed the US economy grew 3.8% — the fastest pace in nearly two years. Weekly jobless claims also came in below estimates, underscoring resilience in consumer spending and the labor market. The Trump administration launched new national security investigations into imports of robotics, industrial machinery, and medical devices, a move that could pave the way for fresh tariffs on hospitals, manufacturers, and PPE like masks and gloves. Starbucks (SBUX) announced a $1B restructuring plan, cutting 900 jobs and closing underperforming stores while refocusing on higher-traffic locations. CoreWeave expanded its partnership with OpenAI, lifting its contract value to $22.4B, while CarMax (KMX) plunged after comparable sales fell as buyers pulled forward purchases ahead of April’s 25% auto tariff.

Takeaways:

US GDP revised up to 3.8%, jobless claims hit two-month low

Trump administration launches new tariff probes on robotics, machinery, and PPE

Starbucks to cut 900 jobs, close stores in $1B restructuring plan

CoreWeave-OpenAI deal expands to $22.4B; CarMax slumps on tariff-driven sales pull-forward

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US stocks rebound after Tuesday’s dip, with Micron (MU) and Alibaba (BABA) driving AI optimism. Micron posted strong results and an upbeat outlook, saying trillions will be invested in AI and memory chips will capture a significant share, prompting multiple Wall Street upgrades. Alibaba surged to a four-year high after pledging to boost AI spending above $50B and launching a new language model while partnering with Nvidia (NVDA). Fed Chair Jerome Powell warned that equities look “highly valued” but reiterated that the Fed is not on a preset path. At the same time, Governor Michelle Bowman called the labor market fragile and argued for faster cuts. Meanwhile, Lithium Americas (LAC) jumped after reports that the Trump administration may take an equity stake in exchange for restructuring a $2.3B DOE loan. Oracle (ORCL) tapped the bond market with a $15B offering to finance cloud infrastructure expansion, and Acadia Pharma (ACAD) sank after a failed rare disease drug trial.

Takeaways:

Micron beats and guides higher; Alibaba pledges $50B AI spend with Nvidia

Powell says stocks are “highly valued”; Bowman warns the jobs market is fragile

Lithium Americas soars on report of potential US government stake

Oracle sells $15B in bonds; Acadia Pharma tumbles on failed trial

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US stocks search for direction after another record close, with futures flat ahead of Fed Chair Jerome Powell’s first remarks since last week’s rate cut. Nvidia (NVDA) confirms plans to invest $100B in OpenAI to build out 10 gigawatts of AI infrastructure, the largest AI project to date. Analysts call it both a bold growth bet and a sign OpenAI may be stretching its finances. The deal lifts chip peers Taiwan Semiconductor (TSM) and Palantir (PLTR), while Nvidia shares consolidate near record highs. Gold surges past $3,800/oz, up more than 40% year to date, driven by central bank buying, ETF inflows, and a weaker dollar. Meanwhile, Disney (DIS) will bring Jimmy Kimmel Live back on air after a week-long suspension, though Sinclair plans to preempt the show on its ABC affiliates. In trending tickers, Kenview (KVUE) rebounds after Trump linked Tylenol to autism, AutoZone (AZO) slips on its fifth straight earnings miss, and Ørsted (ORSTED.CO) jumps after a judge allows its offshore wind project to resume construction.

Takeaways:

Nvidia to invest $100B in OpenAI, fueling AI infrastructure boom

Gold rallies to record highs as Fed easing and weak dollar drive demand

Powell to deliver first speech since Fed rate cut; markets eye guidance

Disney brings Kimmel back, Kenview rebounds, AutoZone and Ørsted move on news

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US stocks pull back from record highs as investors await Fed commentary and key inflation data later this week. Gold hits fresh records while bitcoin retreats. Oracle (ORCL) announces a leadership transition, with CEO Safra Catz moving to executive vice chair and Clay Magouyrk and Mike Sicilia named co-CEOs. The shuffle comes after Oracle’s blowout cloud forecast and major AI deals. Big Tech also faces disruption from President Trump’s new executive order imposing a one-time $100,000 fee on all new H-1B visas, sparking concern in Silicon Valley and sending Indian IT stocks lower. Pfizer (PFE) agrees to acquire obesity drug startup Metsera for $4.9B upfront plus milestones. At the same time, Johnson & Johnson spin-off Kenvue (KVUE) slumps on reports that the Trump administration will warn pregnant women against Tylenol use.

Takeaways:

Stocks pull back as investors await Fed speeches and inflation data

Oracle names co-CEOs as Safra Catz transitions to executive vice chair

Trump orders $100K H-1B visa fee, rattling global tech sector

Pfizer buys obesity drug startup Metsera; Kenvue sinks on Tylenol autism report

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US stocks hover near all-time highs after the Fed’s first rate cut of 2025, with the Russell 2000 (^RUT) closing at a record for the first time since 2021. President Trump and China’s Xi Jinping are holding a high-stakes call on TikTok’s US future, tariffs, and broader trade. Oracle (ORCL) is expected to lead a consortium to run TikTok’s US arm, while Beijing escalates pressure on Nvidia (NVDA) with an antitrust probe and a ban on chip purchases. FedEx (FDX) beats on earnings and reinstates guidance but warns of a $1B tariff hit this year. Netskope (NETS) gains after a strong IPO, and Klaviyo (KVYO) rises on an analyst upgrade. Small caps surge as investors bet on more rate cuts and an earnings rebound.

Takeaways:

US stocks hold at record highs; Russell 2000 joins the rally

Trump and Xi speak on TikTok, tariffs, and trade framework

FedEx beats earnings but warns of $1B tariff impact

Netskope IPO pops, Klaviyo upgraded; small caps gain on Fed easing bets

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Intel (INTC) shares surge after Nvidia (NVDA) unveils a $5B investment and chip collaboration, making it one of Intel’s largest shareholders. The move gives Nvidia optionality in PCs and data centers while boosting Intel’s turnaround hopes. Markets also digest the Fed’s quarter-point cut and dot plot signaling two more cuts this year, with Chair Powell calling it a “risk management” move as labor market concerns grow. In London, President Trump and UK Prime Minister Keir Starmer announce a $42B tech prosperity deal, with Microsoft (MSFT), Google (GOOG), and Nvidia pledging major AI infrastructure investments. Meanwhile, Novo Nordisk (NVO) jumps after a study showed Ozempic outperformed Eli Lilly’s (LLY) Trulicity in reducing cardiovascular risk. Alphabet (GOOGL) rises after China drops an antitrust probe into Android, and GE Healthcare (GEHC) explores a multibillion-dollar stake sale of its China unit.

Takeaways:

Nvidia invests $5B in Intel; chipmakers deepen AI collaboration

Fed cuts 25 bps, signals two more in 2025 amid labor market worries

Trump and Starmer announce $42B UK tech deal with Microsoft, Google, Nvidia

Novo Nordisk rallies on Ozempic data; Alphabet and GE Healthcare gain on China news

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