There was nothing but tumbleweed over the weekend in regards to any resolution of the government shutdown. Israel resumed its deadly bombing of Gaza with the supposed peace agreement barely a week old. Statements out of Kiev and Moscow highlighted entrenched positions that appeared to make the prospect of any kind of viable deal seem rather fanciful.

Coming off their best week since August, stocks moved higher again at the open on Monday (hours after Japanese equities reached fresh all-time record highs) with a strong risk-on mindset ahead of important earnings reports later in the week, particularly from highly-weighted index components Netflix, Tesla and Intel.

Another index heavyweight, Apple, is hurtling towards a $4 trillion valuation and the stock price reached its own new all-time record high for the first time in 2025 on Monday following the release of solid iPhone 17 sales data. This helped push the NASDAQ up to another new record.

Stocks started the session on Tuesday with all the energy of a mandatory driver awareness course. The indexes spent the day hugging the flatline to close unchanged. Gold’s recent spectacular rally came to a screeching halt as the price suffered its worst daily decline in over a decade (see my timely ARTICLE OF THE WEEK in last week’s recap).

Netflix beat Wall Street estimates on earnings and revenue and gave an upbeat forecast after the close, but there was a major caveat. A one-time legal settlement of over $620m with the Brazilian tax authorities was reported and that turned the results into a disappointment versus the estimates. The stock price fell sharply in after-hours trading.

When the real market opened on Wednesday morning, Netflix’s significant decline was confirmed and this, along with developing doubts about the prospects of any imminent Trump/Xi or Trump/Putin meetings and open warfare breaking out among Republican lawmakers about where to go with the shutdown (now the second longest in American history), slammed the indexes substantially lower on the back of some heavy profit-taking.

Indeed, the broad momentum unwind intensified across the board as the gold rout continued into a second day and crypto prices also fell hard. Oil prices spiked 5% on the back of the US imposition of deeper sanctions on Russia that specifically blacklisted two major oil companies.

After the close, Tesla reported miserable net income and a plunge in profits in Q3, in spite of consumers reportedly rushing to buy EVs ahead of the tax credit expiry. The stock price fell in the after-market and the decline only accelerated as Musk tried to explain it all away in a chaotic analyst call during which he seemed more focused on pleading the case to shareholders for his proposed trillion dollar pay package.

Stocks got off to a snoozy start on Thursday but picked up steam as the session wore on with the Trump/Xi meeting seemingly back on, Tesla clawing back some of its initial losses, energy names benefitting from the continuing oil price jump and more positive earnings reports. After a higher close for the indexes, Intel’s numbers, sprinkled as they were with a generous helping of AI pixie dust, comfortably beat estimates.

All seemed to be getting back on track, until a late night out-of-left-field announcement from Trump that he was terminating trade negotiations with Canada because he had been a bit irked by some TV ad aired in Ontario that poked holes in the idea of tariffs. Assuming yet more TACO, Wall Street just rolled its eyes and got on with its day on Friday.

An oasis in the shutdown data desert finally showed up with the delayed pre-market CPI report for September. It showed a small increase to a 3.0% annualized inflation rate that is still a long way from the Fed’s 2.0% target and slowly drifting in the wrong direction.

Nevertheless, the fact that there was no horror show inflation number confirmed to markets that a lowering of the Fed Funds Interest Rate this week is fully locked in with a green light for another cut in December (see INTEREST RATE EXPECTATIONS below). Stocks surged to end the week at yet more new all-time record highs with the S&P 500 closing in on the 6800 level.

This is a massive upcoming week and I am not being hyperbolic when I say that. Not only is the Fed issuing its interest rate decision on Wednesday but we also get to see Q3 earnings from three Mag 7 names (Microsoft, Meta and Alphabet/Google) as well as ~35% of S&P 500 companies in the busiest week of the earnings season.

The government shutdown pressure will ratchet up further with not far off a million workers set to miss a paycheck on Thursday. Trump and Xi will (maybe) meet this week in Malaysia while the US and Canada will try to repair a currently-broken trading relationship.

Throw in critical elections in Argentina and a military escalation off the coast of Venezuela and Wall Street will be on high alert. And who knows what else could suddenly crop up? Happy Halloween.

If you are not yet a financial planning or investment management client of Anglia Advisors and would like to explore becoming one, please feel free to reach out to arrange a complimentary no-obligation discovery call with me.

ARTICLE OF THE WEEK ..

A framework for dealing with a highly-appreciated stock position with huge gains. There are no easy answers.

.. AND I QUOTE ..

“When it comes to investing a lot of things are interesting without being meaningful”.

David Booth, Co-founder Dimensional Fund Advisors

LAST WEEK BY THE NUMBERS:

Last week’s market color courtesy of finviz.com

Last week’s best performing US sector: Technology (two biggest holdings: Nvidia, Microsoft) ⬆︎ 3.0% for the week

Last week’s worst performing US sector: Consumer Defensive (two biggest holdings: Walmart, Costco) ⬇︎ 0.8 for the week

* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price rose 1.9% last week, is up 15.6% so far this year and ended the week at a new all-time record closing high.

* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 2.5% last week, is up 12.9% so far this year and ended the week 1.3% below its all-time record closing high (10/15/2025).

* VXUS, a Global Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 1.0% last week, is up 27.2% so far this year and ended the week at a new all-time record closing high.

INTEREST RATES:

* FED FUNDS * ⬌ 4.125% (unchanged)

* PRIME RATE ** ⬌ 7.25% (unchanged)

* 3 MONTH TREASURY ⬇︎ 3.93% (4.00% a week ago)

* 2 YEAR TREASURY ⬆︎ 3.48% (3.46% a week ago)

* 5 YEAR TREASURY ⬆︎ 3.61% (3.59% a week ago)

* 10 YEAR TREASURY *** ⬌ 4.02% (4.02% a week ago)

* 20 YEAR TREASURY ⬇︎ 4.56% (4.58% a week ago)

* 30 YEAR TREASURY ⬇︎ 4.59% (4.60% a week ago)

Data courtesy of the Federal Reserve and the Department of the Treasury as of the market close on Friday

* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.

** Wall Street Journal Prime Rate as of Friday’s close. Used as a basis for determining many consumer loan interest rates such as credit cards, personal loans, home equity loans/lines of credit, securities-based lending and auto loans.

*** Used as a basis for determining mortgage interest rates and some business loans

AVERAGE 30-YEAR FIXED MORTGAGE RATE:

* ⬇︎ 6.19%

One week ago: 6.27%, one month ago: 6.32%, one year ago: 6.54%

Data courtesy of Freddie Mac Primary Mortgage Market Survey

INTEREST RATE EXPECTATIONS:

Where will the Fed Funds interest rate be after the next rate-setting meeting on October 29th?

* Unchanged from now .. ⬌ 1% probability (1% a week ago)

* 0.25% lower than now .. ⬌ 99% probability (99% a week ago)

With two more Fed rate-setting meetings left in 2025, what is the most commonly-expected number of remaining 0.25% Fed Funds interest rate cuts this year?

* ⬌ Two (unchanged from a week ago)

Data courtesy of CME FedWatch Tool

All data based on the Fed Funds interest rate (currently 4.125%). Calculated from Federal Funds futures prices as of the market close on Friday.

PERCENT OF S&P 500 STOCKS ABOVE THEIR OWN 200-DAY MOVING AVERAGE:

* ⬆︎ 63%

One week ago: 58%, one month ago: 61%, one year ago: 72%

Data courtesy of MacroMicro as of Friday’s market close

This widely-used technical measure of market breadth is considered to be a robust indicator of the overall health of the S&P 500 index.

A high percentage (above 70%) generally suggests broad market strength and a bullish trend, while a low percentage (below 30%) may indicate market weakness and a bearish trend.

FEAR & GREED INDEX:

“Be fearful when others are greedy and be greedy when others are fearful.” Warren Buffet.

Data courtesy of CNN Business as of Friday’s market close

The Fear & Greed Index from CNN Business can be used as an attempt to gauge whether or not stocks are fairly priced and to determine the mood of the market. It is a compilation of seven of the most important indicators that measure different aspects of stock market behavior. They are: market momentum, stock price strength, stock price breadth, put and call option ratio, junk bond demand, market volatility and safe haven demand.

Extreme Fear readings can lead to potential opportunities as investors may have driven prices “too low” from a possibly excessive risk-off negative sentiment.

Extreme Greed readings can be associated with possibly too-frothy prices and a sense of “FOMO” with investors chasing rallies in an excessively risk-on environment . This overcrowded positioning leaves the market potentially vulnerable to a sharp downward reversal at some point.

A “sweet spot” is considered to be in the lower-to-mid “Greed” zone.

Anglia Advisors has updated its Privacy Policy. You can view the latest version here.

WWW.ANGLIAADVISORS.COM | [email protected] | CALL OR TEXT: (646) 286 0290 | FOLLOW ANGLIA ADVISORS ON INSTAGRAM

This material represents a highly opinionated, speculative assessment of the financial market environment based on assumptions and prevailing information and data at a specific point in time and is always subject to change at any time. Although the content is believed to be correct at the time of publication, no warranty of its accuracy or completeness is ever given. It is never to be interpreted as an attempt to forecast any future events, nor does it offer any kind of guarantee whatsoever of future results, circumstances or outcomes.

The material contained herein is not necessarily complete and is also wholly insufficient to be relied upon as research or investment advice or as a sole basis for any financial determinations, including investment decisions or making any kind of consumer choices, without further consultation with Anglia Advisors or other fully-qualified Registered Investment Advisor. The user assumes the entire risk of any decisions made or actions taken based in whole or in part on any of the information provided in this or any other Anglia Advisors published content.

Under no circumstances is any Anglia Advisors’ content ever intended to constitute tax, legal or medical advice and should never be taken as such. Neither the information contained nor any opinion expressed herein constitutes a solicitation for the purchase of any security or asset class. No formal client advice may be rendered by Anglia Advisors unless and until a properly-executed client engagement agreement is in place.

Posts may contain links or references to third party websites or may post data or graphics from them for the convenience and interest of readers. While Anglia Advisors might have reason to believe in the quality of the content provided on these sites, the firm has no control over, and is not in any way responsible for, the accuracy of such content nor for the security or privacy protocols that external sites may or may not employ. By making use of such links, the user assumes, in its entirety, any kind of risk associated with accessing them or making use of any information provided therein.

Those associated with Anglia Advisors, including clients with managed or advised investments, may maintain positions in securities and/or asset classes mentioned in this post.

If you enjoyed this post, why not share it with someone?

This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit simonbrady.substack.com