S&P 500 Index: +2.27%
Dow Jones Industrial Average: +2.51%
Nasdaq Composite Index: +4.7%
Russell 2000 Index: +1.76%
S&P Target Risk Moderate: +1.23%

It has been an eventful few weeks for the markets, with a flurry of third-quarter earnings reports, renewed tariff headlines, and the Federal Reserve cutting interest rates for the second consecutive month. Despite all the noise, equity markets have continued to grind higher, demonstrating impressive resilience in the face of ongoing uncertainty.

Earnings season has been largely positive so far, with many of the world’s heavyweights reporting solid results. While not every company has impressed, the overall tone has been encouraging, and many stocks have responded favorably following their reports. With a few more weeks to go before the bulk of companies have announced results, investors will be watching closely to see if the trend of stronger-than-expected earnings continues.

On the trade front, tariffs have once again become a focal point. President Trump appears to have reached a tentative agreement with China (for now) that would significantly reduce tariffs. The details continue to evolve, but as of now, the proposed terms include lowering tariffs to 47%, China committing to curb the flow of fentanyl into the U.S., pausing export restrictions on rare earth minerals, and increasing purchases of U.S. energy and
agricultural goods such as soybeans. At the same time, President Trump has announced the termination of trade negotiations with Canada following an ad campaign that criticized U.S. tariff policy.

Meanwhile, on October 29th, the Federal Reserve lowered interest rates by 0.25%, bringing the federal funds rate to a target range of 3.75%–4.00%. The move was widely anticipated by markets. However, comments from Fed Chair Jerome Powell suggested that future cuts are not guaranteed, which unsettled investors. Just a week before the meeting, markets were pricing in a 91% probability of another rate cut at the December 10th meeting. Following Powell’s remarks, those odds have fallen to around 63%, according to CME Group data.

Lastly, the S&P 500 has managed to post gains since the government shutdown began. Historically, shutdowns have had limited long-term impact on markets, and this one has been no exception so far. Still, the sooner policymakers can reach an agreement and reopen the government, the better for overall economic momentum and investor sentiment.

As always, don’t hesitate to contact our team with any questions.