October 8th Market Overview

Happy Wednesday

Markets made new highs. Gold broke the big $4k.

Same day, different fears.

When investors buy stocks and gold simultaneously, they're betting on growth while hedging against the currency that measures it. What a fun juxtaposition we are in.

Nvidia's CEO said AI demand is real and growing. Oracle's margin scare yesterday was noise. The Fed released minutes showing officials split on pace, but the shutdown killed their data feed on job reports.

Let's dig in...

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Today's Big Picture

1. Gold Breaks $4,000 as Currency Trust Erodes

Gold hit $4,000 for the first time with $33 billion flowing into ETFs in September alone, the largest monthly inflow on record. Silver is testing 1980 highs while platinum is up 85% this year.

Citadel's Ken Griffin captured it: “investors now view gold as the safe-harbor the dollar used to be. This is structural, not a trade.”

2. Fed Cut Last Month, Split on What's Next

Minutes from September's meeting (released today) show officials made their first cut of 2025 but remain divided on how many more to do this year. The government shutdown is blocking new economic data right when they need it for the October decision. Futures price 95% odds they cut again later this month. Data blackout plus dovish bias equals rate-sensitive positioning with headline risk.

3. AI Demand Real, Valuations Stretched

Nvidia's CEO said computing demand rose substantially in the past six months, backing up field checks showing strong Q3 spending from Microsoft, Alphabet, and Amazon. Bank of England warned stretched AI valuations create correction risk. Demand holds, multiples don't. Pick your spots.

Market Overview

Index Performance

Stock Spotlight

AST SpaceMobile $ASTS ( ▲ 9.83% ) 
signed a deal with Verizon $VZ to provide space-based cellular service to standard smartphones starting in 2026. Voice, video, and messaging tests already successful.

Rocket Lab $RKLB ( ▲ 4.52% ) 
added three more Electron missions with Japan's iQPS starting 2026 from New Zealand, bringing total upcoming launches to seven with that partner.

Nvidia $NVDA ( ▲ 1.91% ) 
CEO Jensen Huang told CNBC that AI computing demand has climbed meaningfully over the past six months. He confirmed involvement in xAI's financing and called AMD's $AMD OpenAI deal structure "imaginative."

Advanced Micro Devices $AMD ( ▲ 11.31% ) 
signed a multi-year OpenAI partnership potentially worth over $100 billion with first deployments late 2026. OpenAI received warrants giving them the option to buy 10% of AMD at $0.01 per share.

Big Name Updates

Tesla $TSLA ( ▲ 1.19% ) 
launched cheaper Model Y and Model 3 trims at $39,990 and $36,990, though these don't cover the expired $7,500 EV tax credit. Separately, the company shelved its goal to produce thousands of Optimus robots in 2025 due to technical issues with the robots' hands.

TopBuild $BLD ( ▲ 7.99% ) 
is buying Specialty Products & Insulation for $1 billion cash, expanding its insulation business footprint.

Fair Isaac $FICO ( ▼ 8.87% ) 
fell after Equifax $EFX ( ▲ 1.45% ) cut mortgage score pricing. Fair Isaac recently said it would sell directly to lenders, bypassing credit bureaus. The pricing war is on.

Other Notable Company News

Joby Aviation $JOBY ( ▼ 8.57% ) 
priced a $513.9 million stock offering at $16.85 per share to fund certification and commercial rollout next year.

Alibaba $BABA ( ▲ 0.06% ) 
set up an in-house robot AI team. Jefferies reiterated as top pick ahead of November 13 earnings with a $230 price target.

Domino's Pizza $DPZ ( ▲ 0.48% ) 
got an outperform rating from Evercore at $520 on market share gains from value pricing, stuffed crust, and DoorDash marketing.

Amazon $AMZN ( ▲ 1.47% ) 
is launching pharmacy kiosks at One Medical locations in Los Angeles starting December, letting patients grab prescriptions right after appointments.

Intel $INTC ( ▲ 0.7% ) 
downgraded to reduce by HSBC despite raising the price target to $24. Firm says manufacturing execution remains key to turnaround.

Sector Watch

Bond Market

The 10-year auction went fine today, the first since the shutdown began. Yields barely moved on the $39 billion sale.

Dollar hit its highest level since August 1, gaining against the yen and euro. Typically a strong dollar pressures commodities, which makes gold's rally more notable/significant.

Tomorrow: $22 billion 30-year bond auction.

Policy Watch

Fed

September minutes showed officials split on pace of cuts. Futures pricing 95% odds of another cut in October. Powell speaks Thursday at community bank conference.

Government Shutdown

Day eight with no progress. Trump said back pay for furloughed workers "depends on who we're talking about." Military paycheck scheduled for October 15 at risk. Private companies seeing delayed projects, layoffs, and stalled contracts.

Fiscal & Trade

Congressional Budget Office reported FY2025 deficit at $1.8 trillion, flat with last year despite higher tariff revenue. On trade, EU announced plans to cut tariff-free steel imports.

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What to Watch

Powell Speaks Thursday

Fed Chair speaks amid a data blackout from the shutdown. Markets will parse every word for clues on the October decision.

Earnings Start: PepsiCo, Delta

PepsiCo reports Thursday - watch for consumer spending commentary. Delta reports same day - focus on travel demand holding up or softening.

30-Year Bond Auction Tomorrow

$22 billion test of appetite for long-dated debt with shutdown uncertainty hanging over fiscal outlook.

Shutdown Progress

Any movement on funding or clarity on military back pay. The longer this drags, the bigger the economic hit.

Thanks for reading 🙂

- John

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