September 23rd Market Overview

Happy Tuesday

Reality check day as the market cooled off from yesterday's AI party. Powell didn't help matters by calling stocks "fairly highly valued" never what you want to hear when you're sitting at record highs.

The Nvidia-OpenAI deal that looked brilliant Monday started feeling a bit circular by Tuesday, not much going on today as far as real market moving developments.

Let's dig in...

Today's Big Picture

Fed Chair Calls Market Overvalued 
Powell made his first public comments since last week's rate cut and called equity prices "fairly highly valued." He also said there's no clear path for more cuts. Markets pulled back as investors digested his warning.

NVIDIA's $100 Billion Partnership Questions
Nvidia $NVDA announced a massive partnership with OpenAI that raised eyebrows. The deal has a chip company funding its customer's expansion, which looks circular. Investors also questioned whether there's enough energy infrastructure to support OpenAI's data center plans.

Boeing Scores International Wins Boeing 
$BA secured an $8 billion contract with Uzbekistan Airways for 22 Dreamliners. Reports suggest a 500-jet China deal might be close too. These contracts mark a turnaround after years of limited international sales.

Market Overview

U.S. Stock indexes, past three sessions

Stock Spotlight

Nvidia $NVDA ( ▲ 0.28% ) 
declined as investors questioned the energy requirements for its OpenAI partnership. The planned data center buildout would require massive power infrastructure that may not exist yet.

Boeing $BA ( ▲ 3.62% ) 
gained on the confirmed Uzbekistan Airways deal and reports that China negotiations are in final stages. Trump praised the $8 billion contract in a social media post.

Kenvue $KVUE ( ▲ 1.55% ) 
recovered after Monday's selloff following Trump's autism comments about Tylenol. Health agencies issued more measured responses that helped stabilize the stock.

Johnson & Johnson $JNJ ( ▲ 1.11% ) 
received a Guggenheim upgrade to Buy with a $160 target. The firm cited confidence in the innovative medicine pipeline after navigating Stelara's patent expiration.

AutoZone $AZO ( ▲ 1.5% ) 
fell on disappointing quarterly results. Earnings of $48.71 per share missed the $50.73 consensus as tariff pressure hit margins.

Big Name Updates

Amazon $AMZN ( ▲ 0.75% ) 
announced plans to close Amazon Fresh stores in the U.K. The move continues the company's retreat from physical retail formats.

Oracle $ORCL ( ▼ 2.7% ) 
declined despite strong AI-driven gains this year. The company is seeking new Taiwan manufacturing partners to handle $455 billion in remaining performance obligations.

Microsoft $MSFT ( ▲ 0.87% ) 
faced regulatory pressure as the EU targeted the company alongside Apple and Google over online financial scams.

Other Notable Company News

Firefly Aerospace $FLY ( ▼ 4.46% ) 
declined on its first earnings report since going public. The space company reported wider losses and revenue that missed analyst expectations.

IonQ $IONQ ( ▼ 3.1% ) 
gained on quantum computing news with Air Force Research Lab support. The company demonstrated technology that could connect quantum computers over existing fiber networks.

Micron Technology $MU ( ▲ 0.28% ) 
rose ahead of its afternoon earnings report. Investors positioned for the memory chip maker's results amid a challenging semiconductor environment.

Sector Watch

Bond Market

The 10-year Treasury yield fell to 4.118% as Powell's valuation comments outweighed hawkish signals from regional Fed presidents.

Policy Watch

Global Growth Upgraded
The OECD raised its global growth forecast to 3.2% from 2.9%, citing emerging market strength and AI-driven U.S. investment. They lifted U.S. growth expectations to 1.8% from 1.6% but warned tariff impacts are still ahead.

Business Activity Cooling

• The flash PMI fell to 53.6 from 54.6, marking the second straight monthly decline

• Companies reduced hiring while tariff costs continued pressuring margins

• Fewer firms could pass higher input costs to customers, potentially easing inflation concerns

International Moves
Sweden's Riksbank cut rates to 1.75% and signaled the easing cycle may be complete, contrasting with Fed uncertainty about future moves.

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What to Watch

Friday’s Inflation Data
The Fed’s preferred PCE measure could determine whether September’s rate cut was smart or premature. Any uptick in inflation would make Powell’s job much harder.

China Trade Breakthrough
Boeing’s potential 500-jet deal with China would be massive for both companies and could signal thawing relations. Watch for any official announcements.

AI Infrastructure Reality
The questions around Nvidia’s OpenAI partnership might spread to other AI infrastructure investments. Energy capacity is becoming a real constraint for these ambitious buildout plans.

Thanks for reading 🙂

- John