Wednesday, October 8, 2025
This wasn’t going to be one of those eventful weeks for economic data anyway. Aside from a delayed Trade Deficit and sure-to-be-postponed Weekly Jobless Claims and Inventories numbers later in the coming days, the federal government shutdown which began last week hasn’t impeded much data so far, at least for this week.
Expected later today are the prepared minutes from the Federal Open Market Committee (FOMC) meeting in mid-September. In its policy statement, the Fed agreed to lower the Fed funds rate 25 basis points (bps), something it hadn’t done since December of last year, taking the benchmark interest rate range to between 4.00-4.25% — where we hadn’t been in three years.
With moderating economic growth and a notable slowdown in the previously robust labor market, up-ticks in inflation levels — from +2.3% in April to +2.9% in August — were superseded by these other factors in leading the Fed to lower rates. President Trump’s latest entrant into the FOMC, Stephen Miran, argued for a 50 bps cut in the September meeting, keeping in-line with his mission to lower interest rates faster than other current Fed officials warrant.
Thus, today’s minutes should clarify the lay of the land in the Fed these days. The good news is that this Fed — led for the past seven years by Chair Jerome Powell, whose term ends next May — has been reasonably transparent in its measures; few moved by the Fed were not first telegraphed to Wall Street, including a change of heart during a Fed “blackout period,” where intentions were leaked to the Wall Street Journal.
Jensen Huang Speaks Up for the AI Revolution
Both yesterday afternoon and early this morning,
NVIDIA NVDA CEO Jensen Huang has made appearances on CNBC to discuss the ongoing AI buildout which has been driving the stock market all year and before. These interviews came at a fortuitous time for AI bulls, who were just beginning to fend off accusations that we’d entered an “AI bubble.” Yesterday’s slight selloff may have been an indication of such concerns.
Huang went down the checklist of semiconductor firms, AI service companies, energy suppliers, etc. that are actually doing AI buildouts presently. Real money is being spent, real partnerships being formed. Compared to the vacuous “dot-com bubble” from a quarter century ago, which went from boom to bust in still-memorable fashion, Huang insists the AI revolution is just getting started.
Taking a look at NVIDIA’s market capitalization currently, at $4.5 TRILLION, we can understand why some investors would be concerned. Yet with a P/E multiple of 41.6x forward earnings, yes this is an elevated level, but not even close to the “bubble-icious” levels of Internet companies with weak forward outlooks but multiples over 100x.
Also, for those of us old enough to recall the tech boom at the start of the Millennium, its bust was preceded by a frenzy of investment activity into various dot-com names on the part of “fear of missing out” (FOMO, which was not a term back then) participants who did not do their homework. When the bust did come, the Warren Buffetts of the world were the ones who proved smart by sticking to investing in what they knew.
What to Expect from the Stock Market Today
We’re still a day away from Q3 earnings reporting from
Delta Air Lines DAL, which is now the de facto start of earnings season. Fed officials continue to make appearances today, though the September Fed minutes will likely be what, if anything, reveals any burgeoning interest in a change of heart at the FOMC. But we don’t really expect that.
The near-term question is whether or not market indexes will start a new string of daily wins, and whether they have the gumption to push into new all-time high closing levels again. Chances are pretty good, at least from this vista: the Dow is +133 points, the S&P 500 is +11, the Nasdaq +35 and the small-cap Russell 2000 is +10 points at this hour.
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Delta Air Lines, Inc. (DAL): Free Stock Analysis Report NVIDIA Corporation (NVDA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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