Closing Recap

Tuesday, September 23, 2025

U.S. stocks opened at highs for the S&P 500, Nasdaq Comp, Dow Jones Industrials and Russell 2000 but for the first time in a while, was unable to hold those gains, seeing a modest decline throughout the day on some profit taking and ahead of key inflation data later this week. There were no specific headlines that turned markets lower, as market breadth finished flat after a more than 2:1 lead by advancers over decliners while momentum names/sectors saw weakness while lagging sectors such as Energy (XLE) outperformed. For a change, technology (XLK) led this afternoon’s pullback, led by large cap like AMZN, NVDA and after Federal Reserve Chair Jerome Powell made his first public remarks since the central bank’s interest-rate cut last week. His comments when asked about market valuations (see below) were possibly a cause for the daily slide, but markets had also been surging in recent days, so a breather was not totally unexpected. Also note the U.S. government is eight days from its 15th partial shutdown since 1981, and both chambers are out all this week with the Senate not due to return to Washington until September 29, so that remains a concern.

Several Fed speakers today: 1) Fed Chairman Powell, speaking at the Rhode Island Greater Providence Chamber of Commerce reiterated many comments from the FOMC policy meeting Q&A last week, while adding, “we do look at overall financial conditions, and we ask ourselves whether our policies are affecting financial conditions in a way that is what we’re trying to achieve. But you’re right, by many measures, for example, equity prices are fairly highly valued.” 2) Federal Reserve Bank of Atlanta President Raphael Bostic said Tuesday inflation risks are still in play in the U.S. economy. “Business leaders are telling us they are definitely feeling the cost pressures, and it is becoming increasingly difficult to prevent those from flowing into prices that are faced by consumers and by their customers,” Bostic said during a live taping of the Macro Musings podcast. When it comes to inflation, “I actually think there’s still more to come” on that front. 3) Fed Vice Chair for Supervision Michelle Bowman said The Federal Reserve may be late in supporting the labor market and could need to speed the pace of rate cuts if demand weakens and businesses begin to lay off workers. 4) Federal Reserve Bank of Chicago President Austan Goolsbee said Tuesday if inflation cools off the central bank has some space to cut its interest rate target. “I think eventually, at a gradual pace, rates can come down a fair amount if we can get this stagflationary dust out of the air,” Goolsbee said in an interview with CNBC.

• Richmond Fed composite manufacturing index -17 in Sept vs -7 in Aug, Richmond Fed manufacturing shipments index -20 in Sept vs -5 in Aug and Richmond Fed services revenues index +1 in Sept vs +4 in Aug
• The OECD September report was released, and it expects a sluggish pace of GDP growth in the Eurozone of 1.2% in 2025 and 1.0% in 2026. While the US economy is seen slowing down – from 2.8% in 2024 to 1.8% in 2025 and 1.5% in 2026.

• NYMEX WTI crude Oct. futures settle at $63.30 a barrel up $0.61, or 0.97% while Brent crude gained $1.06 or 1.59% to settle at $67.63 per barrel. Natural gas prices rose 1.67% to settle at $2.853 mln per Btus snapping a 4-day losing streak. Crude had fallen for a fifth consecutive day on Monday.

• In Beverages: Reuters reported some investors in PEP support suggestions by activist shareholder Elliott Investment Management that the global food and beverage company cut costs and ditch sleepy brands like Quaker. Elliott has said the move would increase PepsiCo’s margins, allowing the $200B company to focus on new chips and sodas. Heineken (HEINY) said it will buy the beverage and retail businesses of Costa Rica’s Florida Ice and Farm Company for $3.2 billion in cash, boosting its presence across Central America.

• In Casinos & Gaming: potential key catalyst coming up for the casino sector in Macau (WYNN, LVS, MLCO, MGM) as Macau Golden Week will run from October 1 to October 8, coinciding with China’s National Day holiday and the Mid-Autumn Festival. Expectations for visitor numbers and tourism impact are high, with authorities and analysts predicting record arrivals and significant boosts in tourism and gaming revenue.
• In Autos: UBS raised its TSLA Q3 delivery forecast to 475,000 units, about 8% above Wall Street consensus and up 24% QoQ. The increase reflects strong U.S. demand ahead of the IRA tax credit phase-out, record U.S. deliveries since mid-2023, and solid growth in Europe, China, Turkey, and South Korea. UBS expects deliveries to exceed production by ~7%, reducing Q2 inventory, but forecasts a sequential drop to 428,000 units in Q4. Full-year 2025 forecast remains 1.62M vehicles."
• In Lodging (MAR, H, HLT, CHH): Bernstein previews Q3 earnings for hotels, saying Q3 looks to be another challenging quarter for stocks, with July – August data showing slowing RevPAR growth across every region globally. The US in particular has been weak, with LSD RevPAR declines across every chain scale but Luxury, as geopolitical uncertainty weigh on the consumer.

• In Nuclear/Power sector: couple names downgraded after massive run up in shares as OKLO was downgraded to Neutral from Buy at Seaport Research and VST was downgraded to Hold from Buy at Jefferies following the 160% run-up in stock in the past year, which the firm attributes to the expectation of a Comanche Peak nuclear deal. LB said it entered into an agreement with utility NRG to power potential data center in Reeves County, Texas, in Delaware Basin. LB says NRG may build 1,100-megawatt gas power plant at site if it secures power purchase agreement for data center.
• In Utilities: SRE said it would sell its 45% equity interest in unit Sempra Infrastructure Partners for $10 billion to the affiliates of investment firm KKR and Canada Pension Plan Investment Board in deal that implies an equity value of $22.2B and an enterprise value of $31.7B for Sempra Infrastructure Partners. EXC plans to step up its push to own power plants in its Mid-Atlantic service area next year, where electricity bills are spiking in the face of rising demand and new supplies are slow to be added, CEO told Reuters.

• In Brokers & Exchanges: HOOD price tgt raised to $140 from $120 at Piper saying the Prediction Markets (aka event contracts) present significant upside opportunity for Robinhood. Notes event contract volumes at Kalshi – the private event contract exchange Robinhood has partnered with – are on track for record monthly volumes in September ($2.6B) – more than double the previous monthly record. MS is preparing to offer crypto trading to its retail customers through its e-trade division by the first half of 2026, CNBC reported saying the firm is partnering with Zero Hash for liquidity, custody, and settlement, initially offering direct ownership of Bitcoin, Ether, and Solana.

• EPRX 12.727M share Spot Secondary, priced at $5.50.
• JNJ was upgraded to Buy from Neutral at Guggenheim and raised tgt to $206 from $167, given the comfort in how the company has navigated the loss of exclusivity for their $10B+ asset, Stelara, and the emerging new product story in their Innovative Medicine business
• KVUE shares rebounded, clawing back most of yesterday’s -7.5% drop, as Trump administration’s claims of Tylenol’s danger to pregnant women draws sharp criticism from researchers.
• LLY said plans to build a new $6.5B facility to manufacture active pharmaceutical ingredients in Texas.
• MBX 10M share Secondary, priced at $20.00.
• MCK shares rose as the drug distributor raises FY26 adjusted EPS view to $38.05-$38.55 from $37.10-$37.90 and boosted its long-term adjusted EPS view to up 13%-16% from up 12%-14% citing strength of McKesson’s leading platforms in oncology, multispecialty, and biopharma solutions.
• SRRK shares fell after the U.S. FDA declined to approve Scholar Rock’s drug for a rare neuromuscular disease, citing issues at a third-party manufacturing facility.

• In Rare Earth sector (MP, USAR, CRML), Bloomberg reported the US-China dispute over Beijing’s control of rare earth supplies has yet to be resolved, the head of a visiting US congressional delegation said after meeting Chinese officials, signaling a key irritant persists in bilateral relations.
• In Lithium sector: Bloomberg reported The Trump administration is reconsidering a $2.3 billion loan for LAC’s Thacker Pass project in Nevada, originally approved under Biden, with a push for GM to secure an offtake agreement, possibly indicating a shift in US priorities from energy transition to national security minerals. GM last year acquired a 38% stake in the project for $625 million in total cash and letters of credit – to sign a binding offtake agreement for the mine’s production,

• BA shares rose after President Trump announces Uzbekistan Airways deal worth more than $8B in a deal that includes 14 Boeing 787 Dreamliners with option for eight additional aircraft. Separately, U.S. lawmakers in Beijing discuss potential Chinese commitments to buy more Boeing jets.
• FLY shares fell after earnings as Q2 revs $15.5M vs. est. $16.8M; increased backlog to $1.3 billion by end of July and bolstered balance sheet; FAA cleared Alpha for return to flight; expects 2025 full-year revenue to be between $133M-$145M vs. est. $138.5M
• PLTR price tgt raised to $215 from $180 at Bank America and keeps a Buy rating on the shares after spending time with Akshay Krishnaswamy, the company’s Chief Architect.
• RDW shares rose after the company said its wholly owned subsidiary, Edge Autonomy, has delivered additional aircraft from its Penguin uncrewed aerial system series to the Ukraine Armed Forces.

• In Social Media: for META Citigroup said following Meta Connect and Citi’s call with Mr. Erick Tseng, former Sr. Director of Product Management at Meta, focused on AR/VR/Smart Glasses, they are incrementally positive on Meta’s AI glasses strategy and believe adoption could reach a tipping point in 2026.
• In Telecom sector (VZ, TMUS, T): the Secret Service has disrupted a sprawling telecommunications network in the New York tri-state area that investigators say posed a serious potential disruption to New York’s telecom systems and a possible threat to the United Nations General Assembly meetings this week.

• In IT Services & Consulting: ACN proposed setting up a new campus in the southern Indian state of Andhra Pradesh, aiming to eventually add about 12,000 jobs to its workforce in India, three sources familiar with the matter told Reuters.
• In Software: APP price tgt raise to $740 from $500 at Oppenheimer and raises its Q425 non-gaming revenue and introduce its 2027 revenue/adj. EBITDA estimates of $8.6B/$7.2B (83% margin) saying recent checks with non-gaming brands and agencies are favorable to APP’s near-term growth. PCOR shares advanced after several Wall Street analyst expressed positive view on new CEO news.

• In Semiconductors: ASMIY shares fell after saying they expect 2H revenue at constant currencies to be 5%-10% lower compared with the first half. Full-year revenue growth is likely to come in at the lower end of the previously guided range of 10%-20%; AVGO files for three-part senior notes offering of $5B; in research, LRCX was downgraded to Sector Weight at Keybanc after hitting its price tgt and significantly outperformed peers YTD, in particular pulling ahead in the last month. NVDA shares dipped early, pulling back after hitting all-time highs on Monday. Semiconductors (SOX) hit record highs this morning above 6,350.
• In Memory/NAND: SNDK tgt raised to $125 from $59 at Bank America saying AI demand driving surge in pricing amid tighter NAND market and margins should benefit from undersupply of NAND coupled with lower costs from nodal transitions and ramping eSSD sales.