🌟 Editor's Note
Welcome to this weeks issue of the Friday Rundown! There’s been surprising resilience in the markets despite the government shutdown and the ADP jobs report. Lets hope this stays the course. Keep on reading down below for more and insights into the markets major movers so far. Thank you for being a subscriber to The Amateur Investor.
AI Innovation Triumphs Over Shutdown Chaos
October 1 - 2, 2025
📉🗓️ TL;DR
U.S. stocks reached consecutive record highs despite the first federal government shutdown in seven years, with the S&P 500 gaining 0.4% to close at 6,715.35 and Nasdaq advancing 0.81% to 22,844.05. Markets shrugged off an unprecedented economic data blackout and the worst private payroll decline since March 2023 (-32,000 jobs) to focus on OpenAI's $500 billion valuation and the Trump-Pfizer pharmaceutical pricing deal. Healthcare surged 2.4-2.7% on drug reform while semiconductors jumped 1.9% on AI infrastructure optimism. The shutdown threatens permanent federal layoffs while creating a dangerous information void for the Fed's October 29 meeting, yet the VIX remained subdued near 16.
📊 Market Pulse
Index Performance (2-Day Period):
S&P 500: 6,688.46 → 6,715.35 (+0.40%)
Nasdaq: 22,660.01 → 22,844.05 (+0.81%)
Dow Jones: 46,397.89 → 46,519.72 (+0.26%)
Russell 2000: 2,442 → 2,458.49 (+0.68%)
Key Market Dynamics:
Tuesday: Sharp reversal from -0.5% open to +0.34% close
Wednesday: New record highs despite 9 of 11 sectors declining intraday
Volume: 18.56 billion shares vs 20-day average of 18.38 billion
Pattern: Consistent late-day institutional buying on dips
International Performance:
Germany DAX: +1.45% to 24,463 on tech rally
UK FTSE 100: Fourth consecutive record at 9,446.43
Shanghai: Closed all week for Golden Week holiday
TLDR: Markets rallied to consecutive records despite shutdown, with Nasdaq outperforming on AI momentum.
🏦 Fed Policy & Economic Data
Critical Data Released Before Shutdown:
ADP Employment Report - SHOCKING MISS
Actual: -32,000 jobs
Expected: +45,000 jobs
77,000-job miss from consensus
Worst decline since March 2023
Small businesses lost 40,000 jobs
ISM Manufacturing PMI
49.1 (7th consecutive contraction month)
New Orders fell to 48.9 from 51.4
Data Blackout Impact:
September Employment Report: DELAYED
Initial Jobless Claims: NOT RELEASED
All BLS/Census data: SUSPENDED
Fed must decide October 29 without September jobs data
TLDR: ADP's -32,000 job loss and data blackout create unprecedented Fed uncertainty.
🏭 Sector Specific Performance
Winners:
Healthcare (XLV) - DOMINANT OUTPERFORMER
Performance: +2.4-2.7%
Key Driver: Trump-Pfizer "Most Favored Nation" pricing deal
Impact: 40-85% drug discounts via "TrumpRx.gov" (launching 2026)
Leading Stocks:
Pfizer: +7.3% (3-year tariff exemption secured)
Eli Lilly: +8.2% (negotiations confirmed)
Merck: +7.4%
Biogen: +10% regular session
Technology (XLK)
Performance: +0.6% Tuesday, leading Wednesday
Key Driver: OpenAI's $500 billion valuation
Philadelphia Semiconductor Index: +1.9%
Leaders: Intel +7%, Nvidia at new all-time highs
Losers:
Gold Miners (GDX)
Performance: -2.93% Wednesday
Context: Profit-taking after +127% YTD run
Gold still near record $3,889/oz
REITs (VNQ)
Worst performer Wednesday
Pressure from 10-year yield backing up to 4.11%
TLDR: Healthcare dominated on drug pricing reform while rate-sensitive sectors struggled.
💼 Top Stock Movers
Biggest Winners:
FICO: +20% (direct score sales to mortgage lenders)
Lithium Americas: +32% (DOE taking 5% equity stake)
AES Corporation: +13.7% (BlackRock acquisition talks for $38B)
Biggest Losers:
Gartner Inc: -27.36% (guidance cut despite Q2 beat)
Vertex Pharmaceuticals: -20.57%
Super Micro Computer: -17.88% (accounting concerns)
TLDR: Individual stock volatility extreme with winners/losers exceeding 20% moves.
📰 Major Corporate Developments
Trump-Pfizer Pharmaceutical Deal (October 1)
"Most Favored Nation" pricing requiring international price matching
Discounts of 40-85% on major medications
Pfizer receives 3-year tariff exemption
$70 billion commitment to U.S. manufacturing
BlackRock GIP / AES Corporation
$38 billion acquisition under discussion
Strategic rationale: Surging AI data center power demand
Tariff Implementation (October 1)
100% on branded pharmaceuticals (with exemptions)
50% on kitchen cabinets
25% on heavy-duty trucks
TLDR: Drug pricing reform and AI-driven M&A dominated corporate news. Commodities & Currency Watch
Cryptocurrencies:
Ethereum: +5.80% to $4,385.57
Catalyst: $675.81M Bitcoin ETF inflows
Citi 12-month target: $5,440
Energy:
WTI Crude: Fell to $61.78/bbl (multi-month lows)
Natural Gas: +2.16% to $3.37/MMBtu
Dollar Index:
97.50 (down 10% YTD, worst since 2003)
Reflects U.S. institutional credibility concerns
TLDR: Crypto surged while dollar continued historic decline.
💡 Key Market Themes
AI Infrastructure Trumps Political Chaos
OpenAI's $500 billion valuation catalyzed global semiconductor rally
Philadelphia Semi Index +1.9%, European tech +2.4%
Markets compartmentalizing dysfunction vs innovation
Healthcare Policy Revolution
"Most Favored Nation" pricing promising 40-85% discounts
Sector surge suggests structural positive despite margin concerns
Hidden Labor Market Crisis
ADP: -32,000 jobs (worst since March 2023)
2025 hiring at lowest since 2009
Disconnect between equity euphoria and employment erosion
TLDR: AI exuberance masking deteriorating fundamentals.
🔮 Market Outlook
Immediate Catalysts:
October 3: Senate shutdown vote (Democratic blockade expected)
October 7: Earliest realistic resolution
Q3 earnings season begins October 14
Key Technical Levels:
S&P 500: Resistance at 6,750, support at 6,670
10-Year Treasury: 4.11%, resistance at 4.15%
VIX: 16.28 (complacency below 20)
Critical Risks:
Fed navigating October 29 without data
Shutdown GDP impact: -0.1% to -0.2% per week
Market breadth weakness (9 of 11 sectors declined intraday)
💡Key Takeaways
Markets are betting AI innovation and healthcare reform outweigh political dysfunction and economic weakening—a increasingly risky wager. Three critical divergences demand attention:
Technology concentration vs broad participation
Equity euphoria vs employment erosion
VIX complacency vs mounting systemic risks
The rally's sustainability requires swift shutdown resolution, Q3 earnings validation, and labor market stabilization. Without all three, October's records may mark a significant top rather than continuation. Watch the October 29 Fed meeting—deciding monetary policy without September employment data creates unprecedented policy error risk.
Till next time,