Weekly Stock Market Update & SPY Technical Analysis
Volatility remains elevated on the market as traders and investors assess the latest China-U.S. trade developments, the government shutdown, weakness in the labor market, and the start of earnings season.
Let’s focus on what we do know:
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China-U.S. trade developments: Trump said yesterday that the U.S. is in a trade war with China, but we do know that the meeting between him and President Xi is still scheduled with no confirmed date as of now. Trump plans to place 100% additional tariffs on China on November 1st, but we have seen him back out of such threats last minute. There’s a good chance that the tariffs won’t be placed and negotiations will resume. Also, China has also recently stated that their mineral export restrictions are merely a regulatory measure, not an outright cutoff. Meanwhile Trump said that his tariffs on China are unsustainable, signaling he may just be using them as a temporary threat…it’s like just a game of negotiation.
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The government shutdown: While many believe this is a reason for markets to crash, it’s not. Government shutdowns can temporarily cause volatility, but long term they have no real impact on the stock market. The only downside is the lack of economic data during this period, which leaves investors in the dark (likely what leads to volatility / uncertainty).
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Weakness in the labor market: Hiring is slowing, but this is a natural reaction to a period of elevated interest rates. In fact, it may ironically be a good thing that labor market is slow right now as it helps control inflation and reinforces more rate cuts are coming, something markets will celebrate. The biggest downside is a slow enough labor market can lead to a recession, but last week’s IMF reports still project the U.S. economy to grow at 2.4-2.6% this year and next year, challenging the recession argument.
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Earnings season: Earnings data has been strong so far, with the last week’s numbers from ASML and TSMC pointing to strength in the semiconductor and chip market. Semiconductors and technology stocks are leading the market rally, so strong earnings and projections from these key suppliers and manufacturers.
There’s a packed earnings calendar this week, with major names like Netflix, GE Aerospace, Coca-Cola, Texas Instruments, Danaher Corp, Lockheed Martin, Tesla, and IBM set to report. These results will provide a clearer snapshot of corporate health across key sectors, tech, defense, industrials, and consumer staples, and could determine whether the current market rally still has momentum or if a pullback is looming. Many investors remain cautious, waiting to see how Q3 results unfold. We'll be updating reports and any significant changes in our daily analysis for our Hyper Stocks Pro members.
As you can from all the above, there is A LOT to consider right now, but we remain “cool, calm, and collected” through the uncertainty. September / October are historically volatile months, but the fourth quarter is usually the strongest for equities.
SPY Technical Analysis:
Despite the market pullback, selling pressure doesn’t yet feel “panicky.” This seems like a healthy technical drawdown, with some overextended names cooling off as needed and others beginning to show strength on the green days. SPY itself is sitting just above its 50 day moving average, a key level institutional investors use as a gauge of whether a stock is in a short term uptrend or downtrend. So far, it seems be acting as support and could be the base level for a further rally in the holiday period and after uncertainties pass.