Let's get to the big story breakdown.
Well, the Fed Reserve cut interest rates by 0.25 point at the end of their September meeting, and this move was fully expected by markets, so no big surprises.
The decision was nearly unanimous, with only one dissenting vote from Stephen Marron, who was just confirmed to the Fed board this week.
Now looking ahead, most Fed officials see only one rate cut in 2026, which is far less than expected.
Well, joining me on this Friday morning is Peter Tuchman, senior foreign trade.
Atmoss.
Peter, happy Friday.
Happy Friday.
Happy Friday.
I'm so happy to be here.
Well, what a market, right?
We saw the Dow, Nasdaq, S&P 500, Russell closed at record highs.
So where do we go from 7th time of the year, you know, the last year out of 218 trading days we had 58 record closes.
We're here at 27 record closes.
Even in the, think about it, 24 was more of a robust year.
I mean we did have 6 or 7 pullbacks.
We lived through it together, but this year.
There's been so, you know, 2025 is a year where the market's done absolutely everything it could be.
We had the high highs, the low lows, obviously the sell off February, March, April.
We have, you know, a couple of wars going on.
We've got so much going on and then obviously we've got tariffs and interest rates and yet we're still trading at record highs, and I owe a lot of it in my opinion to J Powell.
It's not a political thing.
It's just I think he's really navigated us through, you know, the last 5 years.
S&P is up 100%. since COVID.
So that's an accomplishment in its own right.
We got interest we got inflation down from 8.5% to 2.5%.
We didn't get to that elusive 2% number which, you know, I was chatting with Tim Anderson yesterday and he was saying that you know that number seemed a bit just sort of arbitrary in so many ways, especially coming from 8.5, and that he felt that J.
Powell should have when it got down to 2.4%, we should have spiked the football and claimed victory, and I kind of agree with him, you know, so.
An amazing day yesterday.
So the follow through day after Fed Day is the day that really kind of in my opinion from having done this for 100 years, you know, is where the market tells you what it thinks of it.
The first day is sort of a knee jerk emotional reaction and that was up and down, right?
We saw the initially down first and then it kind of got back to even money, but yesterday was once again a record close and it was a.
Super positive day we had 2 to 1 advance versus declines, so you started to see money being put to work again.
People are are calmed down over their anticipation anxiety around the Fed cut because we did not know.
You and I lived through last year.
We had an anticipated Fed cut rate that didn't happen until September.
They surprised us with a 50% last year and the initial reaction was a selloff of 100.
And points maybe that was still in people's heads that they did not want that because that kind of keys people to think maybe we're in worse shape than we think.
But the economic data proved out that that cuts are warranted.
There are more cuts to come.
I think he kind of keyed us in without really giving us what it was going to.
He said, You haven't heard the last of me for this year, so I kind of think 2 or 3 is 4 on the agenda.
Yeah, and today, Peter, we are watching for details coming out of that call between President Trump as well as China's leader Xi Jinping, and that will determine what happens between the US and China in terms of TikTok.
And of course there's anticipation between the two of them in terms of a meeting coming up.
So given all this uncertainty, what does it mean for the individual sectors?
We did see some deals coming out between the US and UK as well.
Well, look, we're also seeing that all that.
Stuff going on with Intel, right, and the US government made an investment in Intel and then we saw Nvidia making an investment in Intel.
That's fascinating in so many different respects.
We see a lot of these larger companies making big capex expenditures into the AI space as well.
I think, you know, look, China is a lot you mentioned that we are now, Mr.
Trump, I have to admit is really putting himself out there.
We are starting to close those deals.
You and I spoke back in February, March, and April.
What would it be?
To get the market to trade at record highs once again when we were down at those lows and we said deal, deal, deal, done, done, done, and now we're starting to see them UK EU you know major things forged yesterday with with the United Kingdom.
That's a big deal and I think the only thing on the agenda that's still there is China, whether it's a TikTok deal.
There it's something going on with Nvidia or whether it's just a tariff deal across the board, you know, if we were to be able to become friends again and open up the doors of commerce, then I think, you know, then then we're off to the races in my opinion.
I mean, that's one of the barriers to entry.
One more thing that I would like to note is that today is an early S&P rebalance.
Right, normally it would be probably on the 20th or 24th of the month of September.
We have an S&P today and we also have, and one more last fun thing I wanted to say was that Wednesday we had the first time in 2.5 years that the Russell small cap and midcap hit a record high.
What does that mean?
That means that people are looking for value.
They're buying everything that's not locked down.
They're buying crypto, they're buying gold, they're buying equities, they're buying futures, they're buying small cap midcap.
So I think people see a clear runway, you know, we're in the midst of an interest rate cutting cycle.
Historically, that's positive for the markets.
Yeah, so Peter, finally, before I let you go, we have about 60 seconds here.
How is this bull market different from other bull markets?
Wow, you know what, look, bull markets are amazing and they are different than historic bull markets.
I once told you the story that that day in Trump 1.0 at Davos when we went from a bear market to a bull market in one day, right, when it was when he.
First time you mentioned tariffs in China, we were down 1400, we closed up 1400.
Bull markets have different components every time they happen.
This one is extraordinary because we're hanging out at a higher level for a long time.
We were able to get to this point even in the eyes of so much, so much controversy, so many obstacles, and yet we're here and we've talked about it time and time.
Again, there are so many different reasons why earnings are one, money on the sidelines are one, the revolution of AI, the investment in AI by companies from Google to Microsoft to all that.
And so it's all in, it's all in.
It's like you know that scene in, I don't know, one of the James Bond movies where he just puts all his chips in.
We're just, we're all in, you know, and that's what it feels like and that kind of a bull market.
People may think that's scary because maybe there's a bubble underneath it.
I don't feel that way.
OK, Peter, thank you so much for joining me on this Friday.
We'll be back bright and early on Monday.
Have a great weekend.
Giddy up.
Happy training.
Let's go.
