September 18th Market Overview

Happy Friday

Well stocks went nowhere today, and after this week, I’m surprised but ill take it. The Fed hiked for the first time in three years, and the heads of three big AI companies asked their own industry to slow down. Nasdaq finished the week green.

Investors heard the warnings and kept buying AI all with the rate hike lined up.

Let’s dig in...

Today's Big Picture

1. Buffett Steps Down as Berkshire Chairman 
   Warren Buffett, 96, handed the Berkshire Hathaway $BRK.B chairman job to his son Howard but will stay on the board. The stock barely moved, and I'm not surprised. Shares peaked May 2 last year, the day before he announced he'd leave the CEO job, and haven't been back since. The market said its goodbye 17 months ago.
   

2. Fed Talk Pushes the 10-Year Yield Back Above 5 
   The 10-year Treasury yield climbed back above 5 today after a one-day dip. Kansas City Fed President Jeff Schmid said the Fed "has work to do on inflation." Traders added bets on another hike in October, and stocks couldn't get going. The Dow is headed for its third straight losing week, its worst since March.
   

3. Bitcoin Tops $80,000 Again 
   Bitcoin climbed back above $80,000 for the first time since Sept. 7. The push came from Thursday's SEC decision letting trading venues offer digital token versions of U.S. stocks. That mattered more to traders than the big crypto bill that died in Congress this week. Regulators are now writing the rules Congress couldn't pass.

Market Overview

Index Performance

Stock Spotlight

Coinbase $COIN ( ▲ 11.36% )  
led the S&P 500 after filing to list perpetual futures on 50 to 60 big U.S. stocks. They're leveraged contracts that never expire, and no regulated U.S. exchange offers them yet.

Sandisk $SNDK ( ▲ 7.51% )  
was the standout in chips today. Storage and memory makers keep climbing on AI data center demand.

Nucor $NUE ( ▼ 5.42% )  
was the worst stock in the S&P 500 after forecasting weaker third-quarter profit than Wall Street expected. Steel Dynamics $STLD fell on a similar forecast.

Big Name Updates

Apple $AAPL ( ▼ 0.28% )  
started selling the iPhone 18 Pro today at $100 more than last year, thanks to the memory crunch. Orders already take three weeks to ship, and Evercore raised its target to $380.

Netflix $NFLX ( ▼ 4.7% )  
fell after Wells Fargo cut it to underweight with a $57 target, down from $80. The bank says Netflix hasn't had a big original hit in a while, and people are watching less.

Goldman Sachs $GS ( ▼ 1.17% )  
is headed for its worst week since April 2025, and Bank of America $BAC is right there with it. The two led financials to their worst week since March.

CrowdStrike $CRWD ( ▼ 2.69% )  
slipped today but is still on track for a big week. Cybersecurity stocks rallied after those AI warnings, on the bet that companies will spend more to protect themselves.

Blue Chips
MarketBeat lists “7 Blue-Chip Stocks to Add To Your Forever Portfolio”

Other Notable Company News

Nestle $NSRGY ( ▼ 2.09% )  
is weighing options for its Russian business after Moscow handed control to outside administrators.

Eli Lilly $LLY ( ▲ 0.03% )  
got a higher target from Guggenheim, which sees 2026 sales of $89.2 billion, above Lilly's own forecast of $85 billion to $87 billion.

Nike $NKE ( ▼ 2.12% )  
slipped ahead of its removal from the S&P 100 on Monday.

Home Depot $HD ( ▼ 0.85% )  
turns 45 as a public company next week, and no stock has returned more since its $4 million IPO in 1981.

Today’s Sponsor

The ice cream shop that makes money when it's cold

28 Wishes sells ice cream in Los Angeles. Below 70°F, sales fall about 20%. The weather is out of their hands. Rent isn't.

So the owners started putting about $20 a day into Kalshi weather markets, taking the cold side. The days that keep customers away now pay something back.

This is hedging. Big companies have done it for decades, buying protection against bad weather, fuel spikes and rising rates. It used to take a broker, a trading desk, and an order size no corner shop could meet.

Kalshi opens it up. Contracts on weather, fuel prices, inflation, tariffs and regulation, starting at a few dollars. Take a position on the outcome that would hurt you. If it hits, the payout softens it. If it doesn't, the contract expires and the good month was the point.

See how other owners are doing it at Kalshi.com/hedging

Sector Watch

Bond Market

Yields rose today, with the 30-year near 5.33, even as oil fell for a third straight day. Those two moved together most of the week, so today's split tells me bonds are focused on the Fed.

Policy Watch

Fed

Michelle Bowman, the Fed's top bank regulator, released final rules for the yearly big-bank stress tests. Banks will see more detail on the models that grade them, and capital requirements should swing less year to year.

Washington

• The Justice Department is weighing whether to join a lawsuit from Texas and 12 other states against BlackRock $BLK and State Street $STT. The states say the two pushed coal producers to cut output for climate goals, which raised power prices. BlackRock dipped on the report, then bounced back.
  

• President Trump publicly backed Fed Chair Kevin Warsh after Wednesday's hike.

International

The Bank of Japan raised rates a quarter point to its highest level since 1995, as expected. Two board members voted no, which made traders doubt how fast more hikes will come. The yen slid, even with Tokyo and Washington working together to prop it up.

• European Central Bank President Christine Lagarde wouldn't rule out more hikes and called a rate cut "very unlikely." She also confirmed she'll step down in 2027.

What to Watch

Trump and Xi Meet Next Week

President Trump hosts Chinese President Xi Jinping next week, with AI, trade and the yuan on the agenda. U.S. automakers already sent Trump a letter asking him to keep Chinese carmakers out, factories included. Investors in a Goldman survey lean hopeful on Chinese stocks, but JPMorgan says foreign money is still positioned cautiously.

Saudi Crude in October

Saudi Arabia told at least two European buyers they won't get crude next month, according to Bloomberg. It's working to restore about half its damaged East-West pipeline within days, while trading strikes with Yemen's Houthis. With Brent near $103, how fast that pipeline comes back decides a lot about oil from here.

Thanks for reading - you are now the more informed 🙂

- John

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