Mid-Morning Look

Tuesday, September 23, 2025

U.S. stocks open at new highs for the S&P 500, Nasdaq, Dow jones Industrials and a rebound in the Russell 2000 as Smallcaps bounced. Positive sentiment on AI/technology/investments remains the key driver for this stock market along with hopes of futures aggressive rate cuts by the Fed after last week’s 25-bps cut. Not much weighing on investor sentiment though 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. Tech has been the leader over the last few months (XLK, XLC), but financials (XLF) also hitting record highs today. Note the Philadelphia Semi Index (SOX) making another all-time high above 6,350 and now a 46% jump off the April lows around 3,388 as chips surge. Energy stocks have lagged YTD (XLE +4.8% YTD), btu winners on the day up 2.25% with big gains in HAL, APA, FANG, CVX and others. After the massive market rally, stocks taking a breather again today with the S&P 500 (SPX) holding around the 6,700 level. New day, same story as stocks stay well bid, gold prices hitting a new record high above $3,800 an ounce today.

• 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

• In Industrials: SYM was downgraded to Sell from Neutral at UBS (raise tgt to $35 from $27) noting shares are up 170% since April 1 without much evidence of a growth acceleration or new business wins outside of Symbotic’s main customer WMT and believes the company’s fiscal Q3 results did not demonstrate meaningful progress on customer expansion and suggested sales headwinds over the next three quarters. In rental equipment, URI was upgraded to Outperform with a $1,128 price target at Bernstein, implying ~20% upside saying this is a story of cyclical rebound and portfolio transition.
• 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.

• BA +3%; 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.
• CRWV +1%; was upgraded to Buy from Hold at Melius Research Melius Research with a $165 price target and upgraded to OW from EW with $170 tgt at Wells Fargo.
• HAL +7%; as energy stocks seeing strength today – APA, FANG, COP.
• KVUE +6%; recouping most on Monday’s drop, as Trump administration’s claims of Tylenol’s danger to pregnant women draws sharp criticism from researchers.
• LB +7%; 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.
• MCK +6%; 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 12%-14% citing strength of McKesson’s leading platforms in oncology, multispecialty, and biopharma solutions.
• SAVA+25%; after a form 4 filing showed CEO Barry Richard J purchased 237,941 shares at $2.25 between 9/18/25-9/19/25 in purchase valued at $534,749.
• SRE +4%; 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.

• FLY -10%; on 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.
• OKLO -2%; downgraded to Neutral from Buy at Seaport Research based on the current stock valuation.
• SRRK -5%; 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.
• SYM -7%; was downgraded to Sell from Neutral at UBS (raise tgt to $35 from $27) noting shares are up 170% since April 1 without much evidence of a growth acceleration or new business wins outside of Symbotic’s main customer WMT
• VST -4%; after being 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.