What We're Seeing & What We're Watching

For the week of September 28, 2025

WHAT WE'RE SEEING...

Stock market: 

Stocks took a breather last week with the major indexes recording minor losses. The long-running Dow Jones Industrial Average retreated a mere 68 points, closing at 46,247. The widely followed Standard & Poor’s 500 Index dropped just 0.3%, closing at 6,644, while the more volatile and technology-focused Nasdaq Composite Index ended the week in the red by 0.65%, closing at 22,484.

It now appears increasingly likely that the Republicans and Democrats will fail to reach a compromise on a plan to fund the federal government. The current deadline is September 30, and the odds of a shutdown are rising. Historically, the stock market has taken these “man-made” shutdowns in stride, and we think the 2025 shutdown, if it occurs, will be a ho-hum event for stock market investors.

We saw an encouraging post on LinkedIn from Economics Cycle Research Institute (ECRI), a highly respected economic forecasting firm. ECRI posted, “In essence, our forward-looking indicators now point to potential firming in economic growth, with the economy remaining resilient.” Their forecast of firming economic growth and a resilient economy creates a plausible explanation for the stock market’s strong upward momentum since May. It also encourages us to stick with the equity allocations in our clients’ portfolios, as we remain cautiously optimistic for the concluding months of 2025, while keeping one eye focused on risk management.

Interest rates:

The bond market saw a very slight uptick in its key interest rate last week. The yield on the widely followed 10-year US Treasury note increased by four basis points from 4.13% to 4.17%. Our preferred money market fund yield remained unchanged at 3.79%.

Many professional investors consider the bond (interest rate) market to be the “canary in the coal mine” because it has a history of signaling “trouble ahead” warnings to the stock market. Our current assessment of bond market conditions does not point to any such warnings.

Gold and Oil: 

Gold marched higher by $71 last week, closing at $3,790 per ounce, continuing a remarkable 12-month surge of more than 40%. Oil prices, by contrast, have been more subdued. Crude closed at $63.17 per barrel, up slightly for the week but still down roughly 12% year-over-year. While gold often captures headlines, oil remains the more critical driver of the US economy. Lower energy costs act as a brake on inflation and provide households with more spending power elsewhere.

WHAT WE'RE WATCHING...

 As the calendar turns from September to October next week, we will be watching some key reports on the health of the US employment picture. These reports are produced every month, so next week’s numbers will cover September. Most economists are expecting these reports to show some softening in the employment picture, which should give the Federal Reserve additional incentive to further reduce interest rates.

As we move through the final stretch of 2025, we remain mindful that markets can change direction quickly. That’s why our focus stays firmly on the fundamentals: broad diversification to spread risk, thoughtful asset allocation to balance opportunity with stability, and disciplined risk management to safeguard what our clients have worked so hard to build. These principles have stood the test of time, in both calm and turbulent markets, and we believe they remain the surest path to preserving and growing wealth over the long run.

Thank you for taking the time to read this letter. I want it to be informative and beneficial, as I seek to apply four decades of market experience to assessing the current conditions. I always welcome your questions and comments. Feedback, after all, is the breakfast of champions. Serving as your advisor is an awesome privilege, and I look forward to continuing this journey together.

A closing thought from the book of Proverbs in The Passion Translation (circa 2020): “Work hard at your job and you’ll have what you need. Following a get-rich-quick scheme is nothing but a fantasy.” (Proverbs 12:11)

Bruce Robinson, CFP

(The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.  All performance referenced is historical and is no guarantee of future results.  All indices are unmanaged and may not be invested into directly.)