Cover:
-Oracle, founded and controlled by Larry Ellison, has experienced considerable success due to the artificial intelligence boom, reporting a significant uptick in new business. The company's stock surged 373% over three years, significantly outperforming the market's 87% rise and its competitor, Microsoft, which rose by 123%. Ellison, who owns 40.6% stake in Oracle (valued at $343B), has recently remarried and enjoys the success of his two children, Megan and David, as well as engaging in business ventures with them, including offers for media companies like Paramount and Warner Bros. Discovery and a bid for TikTok's U.S. operations. Ellison's enduring vision highlights the importance of data over hardware or consumer internet technologies, asserting that managing and monetizing data is crucial—especially as AI demands massive data efforts. Oracle has secured a $300B deal with OpenAI, indicative of its strong theoretical positioning in AI, but it also faces significant costs and risks, reflecting the company's historical pattern of balancing opportunity and vulnerability.
Interview:
-Raphael Bostic, the president of the Atlanta Federal Reserve (his district spans Alabama, Florida, Georgia, and parts of Louisiana, Mississippi, and Tennessee) has been a prominent inflation hawk throughout 2025, advocating for a conservative approach to interest rate cuts, projecting only one cut for the year compared to the broader Federal Reserve’s expectation of three. Despite a rate reduction in September, Bostic expressed a preference to delay further cuts until 2026. However, recent economic observations and discussions during a visit to Nashville have prompted him to reconsider; he noted that the risks regarding inflation and a declining labor market are becoming more balanced than they have been in the past few years. This shift raises questions about whether Bostic's changing perspective signals a genuine transformation in his views or reflects the uncertain economic landscape that Federal Reserve officials are facing. Bostic observed a change in sentiment among business leaders during his Nashville meetings; concerns over inflation are now nearly on par with fears of layoffs, a shift from earlier months when inflation dominated the conversations.
Tech Trader:
-Are we experiencing an artificial-intelligence bubble akin to the dot-com boom of the 1990s? Indicators suggest parallels, such as investors funding customers and concentrated investments in AI data centers, driven by a high demand for AI computing. Central to this landscape is OpenAI, the creator of ChatGPT, which became a significant player in 2022 and could represent a critical vulnerability for the AI market. The demand for AI is influenced by anticipated future returns. Major tech companies like Meta, Amazon, Alphabet, and Microsoft are projected to spend $335B on capital expenditures this year, while AI startups have raised $259B since 2024, per Crunchbase data. OpenAI stands out with a record $40B funding round, although this pales in comparison to its future spending commitments. CEO Sam Altman has proposed an ambitious trillion-dollar investment plan for global AI data centers to scale ChatGPT to match Google Search's size.
The Trader:
- Utility stocks are performing exceptionally well, with the Utilities Select Sector SPDR ETF up 20% this year, outpacing the S&P 500’s 15% gain. Historically regarded as defensive stocks that provide stability during market downturns, utilities have maintained this reputation in 2025, experiencing an average decline of only 0.26% on the 80 days the S&P 500 fell, and achieving 35 instances of closing higher. However, the sector is also benefiting from the rising demand for energy to support artificial intelligence (AI) data centers, linking utilities to growth within the tech sector. Companies like Constellation Energy and Dominion Energy are supplying power to major hyperscalers, illustrating utilities' dual role as both defensive and offensive investments. Analysts predict earnings growth for utilities at nearly 9% annually over the next two years, contrasting with their historical growth rate of 4.2%. Currently, utilities trade at a valuation of about 19 times their forward earnings, indicating a significant discount compared to the S&P 500's 23 times, suggesting strong potential for future gains.
-The bull market is set to celebrate its third anniversary, but investors are concerned about a potential artificial intelligence bubble and renewed tariff issues, leading to stock sell-offs. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite indices are experiencing significant weekly declines, with the Dow projected to drop 2.2% and the S&P 500 and Nasdaq showing declines of 1.8% and 3.56%, respectively. The week began with worries after AMD announced a deal with OpenAI, positioning itself as a major supplier of AI chips, but ended with concerns over escalating tensions with China expressed by President Trump. Despite recent pullbacks, the stock market has seen strong gains, with the S&P 500 climbing 85% since its low on October 12, 2022, thanks to tempered inflation, a more accommodating Federal Reserve, ongoing economic growth, and a surge in AI investments.
Features:
-September's inflation data release has been delayed due to the government shutdown that began on October 1. The Bureau of Labor Statistics (BLS) is planning to recall furloughed workers to prepare the Consumer Price Index (CPI) to facilitate the Social Security Administration's (SSA) calculation of inflation-adjusted benefit payments. The BLS has announced that the September CPI will be published at 8:30 AM ET on October 24. Other data releases will not occur until regular government services resume. The SSA is mandated by law to calculate annual cost of living adjustments using the third-quarter CPI data and must publish these adjustments before November 1. Although the SSA benefits will continue during the funding lapse due to remaining available funding, necessary BLS staff will be recalled as required to ensure timely completion of the inflation data release.
-Ferrari introduced its first electric model, the Elettrica, in a presentation characterized by sci-fi themes. The event showcased the vehicle's chassis, motor, and battery pack, along with a sound system designed to emulate the traditional supercar roar, aiming to appeal to drivers' sensory experiences. However, the presentation was overshadowed by disappointing financial projections, leading to a 15.8% drop in stock value, marking the company's largest single-day decline since its IPO in October 2015. This downturn interrupted a previous upward trajectory where shares had more than doubled over three years and have now dropped approximately 15% in 2023. The Elettrica represents both challenges and uncertainties for Ferrari, with production underway at a new facility in Maranello. Full details on its launch are expected in spring 2026, as the company revises its electrification strategy, targeting 20% electric models by 2030 to maintain its position as Europe's most valuable car manufacturer, with a market value of $76.5B.
Europe:
- ESG (Environmental, Social, and Governance) investing remains a prominent focus in Europe, with assets under management reaching $3 trillion, constituting 85% of the global total. Despite the U.S. demonization of ESG, it continues to attract European investors, as evidenced by a study from the European Securities and Markets Authority (ESMA) indicating that including an ESG tag can significantly boost fund inflows. However, the meaning of ESG varies widely among Europeans, even after the European Commission introduced the 2021 Sustainable Finance Disclosure Regulation (SFDR). Thousands of funds, covering a range of ESG interpretations, claim adherence to Article 8 of the SFDR, which lacks stringent requirements, generally only excluding coal and tobacco producers. A significant shift is observed as defense stocks, historically avoided by ESG investors, are now increasingly embraced as geopolitical tensions prompt Europe to enhance its military capabilities. More than half of Article 8 funds are now investing in armament manufacturers. This rebranding of defense as socially necessary raises questions about its sustainability status. Furthermore, long-term investors are recognizing that companies face environmental and resource risks that traditional financial disclosures do not adequately capture.
Emerging Markets:
-No update
Commodities:
-Gold futures recently exceeded $4,000 an ounce, marking a significant milestone in the precious metal's trading activity. As of early trading, gold prices were slightly adjusted to $3,978 an ounce, yet they have experienced a substantial increase of over 50% in 2025, making it the most robust yearly performance since 1979 when prices surged due to geopolitical tensions and inflationary pressures. The current surge is attributed to political instability in major economies, with a government collapse in France and a leadership change in Japan prompting expectations of increased public spending. Additionally, the ongoing U.S. government shutdown and anticipation of Federal Reserve interest-rate cuts are further boosting gold's appeal as a safe-haven asset. As the labor market weakens, traders are forecasting an 80% probability of a rate cut by the Fed by the year’s end, enhancing gold's attractiveness compared to other income-generating assets.
Streetwise:
-Stocks, gold, and cryptocurrencies are reaching all-time peaks, leading to inflated portfolio values. Despite concerns about the high S&P 500 index, which stands at 25 times earnings, historical trends suggest limited correlation between current valuations and short-term returns. This situation implies that even high prices could continue to rise. Investing some cash now may mitigate sudden downturn risks, yet it carries the risk of underperforming relative to fully invested neighbors. Among various warning signs, the intertwining financial relationships within the artificial intelligence sector, highlighted in a Morgan Stanley report, stand out. The report’s visual representation of these connections is unsettling yet reflects the industry's dynamic. Previously noted was the case of CoreWeave, transitioning from crypto mining to deploying Nvidia AI chips, with Nvidia being a key investor. Recently, Nvidia made significant investments in OpenAI, the creator of ChatGPT, which in turn partnered with AMD—Nvidia's competitor.