The Profit Margin: October 13, 2025
Statistic of the Week
The “Bank of Mom and Dad” is increasingly supporting adult children in the U.S. According to a recent survey, 75% of Baby Boomer parents reported assisting their children with major purchases such as down payments on cars or homes. Notably, 36% expressed concern that the financial support they are offering might adversely affect their own retirement plans and financial security.
Global Perspective
Last week, gold prices reached $4,000 per ounce for the first time. With limited economic data being published by the federal government, investors are anticipating further interest rate cuts by the FOMC. Additionally, fiscal policies in major global economies such as the U.S., France, Japan, and the U.K. are increasing investor apprehension, driving more investment in the precious metal.
Market Moving Events
Tuesday: NFIB Optimism Index
Wednesday: Empire State Manufacturing, Beige Book
Thursday: Jobless Claims*, Retail Sales*, PPI*
Friday: Housing Starts*, Building Permits*, Industrial Production*
*Denotes data unlikely to be released if federal government remains closed.
Commentary
Investor sentiment was strong for most of last week until renewed trade tensions between the U.S. and China sparked a selloff on Friday. The S&P 500 and Nasdaq both reached record highs midweek before retreating sharply in the final session. All three major U.S. equity indices ended the week lower, with the Dow Jones Industrial Average leading the declines, down 2.73%.1 The Nasdaq fell 2.53%, weighed down by weakness in semiconductor stocks,2 while the S&P 500 slipped 2.43%.3 In contrast, bonds and gold (see “Global Perspective) advanced as investors shifted toward defensive assets. The yield on the 10-year Treasury declined 9 basis points to close Friday at 4.04%.4
Friday’s market decline was triggered by comments from President Trump, who threatened to impose an additional 100% tariff on imported Chinese goods beginning November 1st unless China eases restrictions on rare-earth elements.5 He also indicated that the U.S. plans to tighten export controls on advanced semiconductor technology.6 Although Chinese exports have fallen roughly 30% year-to-date, China remains the United States’ fourth-largest source of imports.7
As of this writing, the federal government remains shut down. However, there was a bit of positive news for Social Security recipients. Some furloughed Bureau of Labor Statistics employees have been recalled to complete the September Consumer Price Index report, which determines the annual cost-of-living adjustment for Social Security benefits. The increase is expected to be approximately 2.5%, slightly below the 20-year average of 2.6%.8
Chart of the Week
Since 2001, the S&P 500 has experienced an average earnings growth rate of 7.7%. At present, the trailing 12-month earnings growth for the S&P stands at 10.7%. The robust performance of the index this year has been largely driven by solid earnings results.
Source Materials
Market Moving Events:
MarketWatch.com
Chart of the Week:
Clearnomics,
LSEG
Statistic of the Week:
Barron’s
Global Perspective:
The Economist
Commentary:
1. Bloomberg
2. Bloomberg, Investor’s Business Daily
3. Bloomberg
4. MarketWatch.com
5. Politico
6. MarketWatch.com
7. MarketWatch.com
8. MarketWatch.com