September 16, 2025 • 8 mins
Fresh news and strategies for traders. SPY Trader episode #1367.
Host Marty Marketmover unpacks today's surging US stock market, with the S&P 500 and Nasdaq hitting new highs, largely fueled by expected Fed interest rate cuts and strong corporate earnings, particularly from tech giants like Alphabet and Tesla. The episode delves into key economic indicators – including rising inflation and a weakening labor market – that are shaping the Fed's decisions. Marty provides actionable investment recommendations, advising diversification into value and smallcaps, cautious tech exposure, leveraging fixed income for stability, and preparing for potential 'sell the news' reactions to the upcoming FOMC announcement.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Hey there , Spy Traders !
I'm your host , Marty Marketmover , and it's 6 am on Tuesday , September 16th , 2025 , Pacific time .
Grab your coffee , because we've got a lot to unpack on this early morning edition .
The market is buzzing with activity , pushing towards new highs , and we're going to break down what's driving it , what it means for your portfolio , and where the smart money is moving .
First up , the big picture (00:23):
The US stock market is showing incredible momentum !
S&P 500 futures and Nasdaq futures are surging today , with the Nasdaq 100 looking to notch its tenth consecutive day of gains .
Yesterday , both the S&P 500 and Nasdaq closed at record intraday highs , with the S&P 500 , or US500 , hitting 6634 points today .
(00:53):
That's a 0.29% gain from yesterday , nearly 3% over the past month , and a stunning 17.74% rise yearoveryear !
This rally is largely thanks to widespread expectations of a Federal Reserve interest rate cut , which is pretty much the talk of the town right now , along with generally solid corporate earnings .
(01:16):
On the company front , we've seen some big movers .
Alphabet , ticker GOOGL , absolutely surged 4.5% , pushing its market cap above a whopping 3 trillion dollars – a huge contributor to the S&P 500's rise .
Tesla , TSLA , climbed 3.6% after CEO Elon Musk reportedly bought a billion dollars worth of stock , which is a pretty clear signal of confidence .
(01:46):
Oracle , ORCL , saw a nearly 5% jump in premarket trading on rumors about its role in a potential USChina deal regarding TikTok .
Nvidia , NVDA , finished flat yesterday amidst reports of China flagging antitrust concerns with its Mellanox acquisition , but the broader tech sector , especially AI plays , remains strong .
(02:08):
The biggest news of the week , hands down , is the Federal Open Market Committee , or FOMC , meeting happening today and tomorrow .
The market is practically screaming for a 25basispoint interest rate cut , which would be the first cut this year , bringing the federal funds rate down to 4.00%4.25% .
(02:29):
While a 50basispoint cut is a long shot , the market has largely priced in that quarterpoint reduction .
So , keep an eye out for a potential ' sell the news' event , especially in more speculative assets .
Now , for the deeper dive and what it all means for you .
Our market is in a fascinating spot (02:46):
strong upward momentum in equities , especially in tech and largecap growth , but it's mixed with some concerning macroeconomic signals .
Inflation , for instance , is a bit ' sticky , ' with the US Consumer Price Index , or CPI , rising to 2.9% yearoveryear in August – the highest since January !
(03:07):
Core CPI is also holding steady .
And the labor market ?
It's showing significant signs of weakening .
We only added 22,000 jobs in August , far below expectations , and the unemployment rate rose to 4.3% , its highest since late 2021 .
Plus , there were massive downward revisions to previous job reports , indicating 911,000 fewer jobs created than initially thought .
(03:37):
This softening labor market is a huge factor behind the Fed's expected rate cut .
Despite these headwinds , GDP growth actually rebounded to a healthy 3.0% in Q2 after a contraction in Q1 , so the economy isn't falling off a cliff just yet .
Mortgage rates have also dropped to an 11month low of 6.35% thanks to the anticipated Fed action .
(04:02):
Sectorwise , Consumer NonCyclical has been the top performer yeartodate , up over 20% , followed closely by Technology and Capital Goods .
Today , Energy and Materials are leading the charge in futures trading , benefiting from rising commodity prices and easing inflation concerns .
(04:22):
Interestingly , August saw a bit of a rotation , with Health Care jumping 5.4% and smallcap stocks , measured by the Russell 2000 , soaring 7.1% , hinting that investors might be looking beyond the megacap tech giants .
So , what's a savvy Spy Trader to do in this environment ?
Here are my recommendations (04:43):
First , Embrace Diversification with a Tilt Towards Value and SmallCap .
While megacap growth has been the darling , the recent outperformance of smallcaps and value in August suggests a broadening market .
So , while maintaining your core broad market exposure with something like the Vanguard Total Stock Market ETF , VTI , or the SPDR S&P 500 ETF Trust , SPY , consider tactically increasing your allocation to value and smallcap segments .
(05:15):
For value , look at the iShares S&P 500 Value ETF , IVE , or the Vanguard Value ETF , VTV .
For smallcap exposure , the iShares Russell 2000 ETF , IWM , or the Vanguard SmallCap ETF , VB , could be great additions , especially since smallcaps jumped last month and are still trading at a discount .
(05:39):
Second , Maintain Cautious but Continued Exposure to Technology , Focusing on Profitable AIadjacent Companies .
Tech is still a powerhouse , but valuations are high for some giants , and regulatory scrutiny , like with Nvidia , is a factor .
Stay selective !
For diversified tech , the Technology Select Sector SPDR Fund , XLK , is a solid choice .
(06:03):
Keep an eye on companies like Oracle , ORCL , given its potential in international deals , and favor AI companies with strong fundamentals and clear paths to profit , rather than just hype .
Third , Consider Fixed Income for Stability , Particularly ShorterDuration Bonds .
With the expected Fed rate cuts , bonds can offer stability and attractive yields .
(06:27):
The 10year US Treasury yield has already dipped to 4.082% .
For broad fixedincome exposure , consider the iShares Core U.S.
Aggregate Bond ETF , AGG , or the Vanguard Total Bond Market ETF , BND .
If you want to capitalize on shortterm rate movements , look into shortterm Treasury ETFs .
(06:51):
Fourth , Monitor Cyclical Sectors with Caution .
While Energy and Materials are strong today , and Consumer Discretionary has performed well , the weakening labor market and potential for slower GDP growth mean caution is warranted .
For those with higher risk tolerance , the Energy Select Sector SPDR Fund , XLE , and the Materials Select Sector SPDR Fund , XLB , could be tactical plays , but always keep an eye on economic data .
Finally , and this is a big one (07:23):
Watch for ' Sell the News ' in RateSensitive Assets .
Since a 25 bps Fed cut is largely priced in , if the actual announcement tomorrow doesn't exceed expectations , we could see a shortterm dip , especially in highly speculative assets like cryptocurrencies .
(07:43):
Longterm investors shouldn't overreact , but traders might consider hedging or reducing exposure to very speculative assets right before the announcement .
To wrap it up , the market is showing incredible resilience , driven by tech and rate cut expectations .
But don't forget those macroeconomic headwinds like the weakening labor market and sticky inflation .
(08:06):
A diversified approach , favoring undervalued segments and staying cautious with highly valued growth , especially around that Fed announcement , is your best bet .
That's all for this edition of Spy Trader !
I'm Marty Marketmover , and I'll catch you next time .
Happy trading !
Hey there , Spy Traders !
I'm your host , Marty Marketmover , and it's 6 am on Tuesday , September 16th , 2025 , Pacific time .
Grab your coffee , because we've got a lot to unpack on this early morning edition .
The market is buzzing with activity , pushing towards new highs , and we're going to break down what's driving it , what it means for your portfolio , and where the smart money is moving .
First up , the big picture (00:23):
The US stock market is showing incredible momentum !
S&P 500 futures and Nasdaq futures are surging today , with the Nasdaq 100 looking to notch its tenth consecutive day of gains .
Yesterday , both the S&P 500 and Nasdaq closed at record intraday highs , with the S&P 500 , or US500 , hitting 6634 points today .
(00:53):
That's a 0.29% gain from yesterday , nearly 3% over the past month , and a stunning 17.74% rise yearoveryear !
This rally is largely thanks to widespread expectations of a Federal Reserve interest rate cut , which is pretty much the talk of the town right now , along with generally solid corporate earnings .
(01:16):
On the company front , we've seen some big movers .
Alphabet , ticker GOOGL , absolutely surged 4.5% , pushing its market cap above a whopping 3 trillion dollars – a huge contributor to the S&P 500's rise .
Tesla , TSLA , climbed 3.6% after CEO Elon Musk reportedly bought a billion dollars worth of stock , which is a pretty clear signal of confidence .
(01:46):
Oracle , ORCL , saw a nearly 5% jump in premarket trading on rumors about its role in a potential USChina deal regarding TikTok .
Nvidia , NVDA , finished flat yesterday amidst reports of China flagging antitrust concerns with its Mellanox acquisition , but the broader tech sector , especially AI plays , remains strong .
(02:08):
The biggest news of the week , hands down , is the Federal Open Market Committee , or FOMC , meeting happening today and tomorrow .
The market is practically screaming for a 25basispoint interest rate cut , which would be the first cut this year , bringing the federal funds rate down to 4.00%4.25% .
(02:29):
While a 50basispoint cut is a long shot , the market has largely priced in that quarterpoint reduction .
So , keep an eye out for a potential ' sell the news' event , especially in more speculative assets .
Now , for the deeper dive and what it all means for you .
Our market is in a fascinating spot (02:46):
strong upward momentum in equities , especially in tech and largecap growth , but it's mixed with some concerning macroeconomic signals .
Inflation , for instance , is a bit ' sticky , ' with the US Consumer Price Index , or CPI , rising to 2.9% yearoveryear in August – the highest since January !
(03:07):
Core CPI is also holding steady .
And the labor market ?
It's showing significant signs of weakening .
We only added 22,000 jobs in August , far below expectations , and the unemployment rate rose to 4.3% , its highest since late 2021 .
Plus , there were massive downward revisions to previous job reports , indicating 911,000 fewer jobs created than initially thought .
(03:37):
This softening labor market is a huge factor behind the Fed's expected rate cut .
Despite these headwinds , GDP growth actually rebounded to a healthy 3.0% in Q2 after a contraction in Q1 , so the economy isn't falling off a cliff just yet .
Mortgage rates have also dropped to an 11month low of 6.35% thanks to the anticipated Fed action .
(04:02):
Sectorwise , Consumer NonCyclical has been the top performer yeartodate , up over 20% , followed closely by Technology and Capital Goods .
Today , Energy and Materials are leading the charge in futures trading , benefiting from rising commodity prices and easing inflation concerns .
(04:22):
Interestingly , August saw a bit of a rotation , with Health Care jumping 5.4% and smallcap stocks , measured by the Russell 2000 , soaring 7.1% , hinting that investors might be looking beyond the megacap tech giants .
So , what's a savvy Spy Trader to do in this environment ?
Here are my recommendations (04:43):
First , Embrace Diversification with a Tilt Towards Value and SmallCap .
While megacap growth has been the darling , the recent outperformance of smallcaps and value in August suggests a broadening market .
So , while maintaining your core broad market exposure with something like the Vanguard Total Stock Market ETF , VTI , or the SPDR S&P 500 ETF Trust , SPY , consider tactically increasing your allocation to value and smallcap segments .
(05:15):
For value , look at the iShares S&P 500 Value ETF , IVE , or the Vanguard Value ETF , VTV .
For smallcap exposure , the iShares Russell 2000 ETF , IWM , or the Vanguard SmallCap ETF , VB , could be great additions , especially since smallcaps jumped last month and are still trading at a discount .
(05:39):
Second , Maintain Cautious but Continued Exposure to Technology , Focusing on Profitable AIadjacent Companies .
Tech is still a powerhouse , but valuations are high for some giants , and regulatory scrutiny , like with Nvidia , is a factor .
Stay selective !
For diversified tech , the Technology Select Sector SPDR Fund , XLK , is a solid choice .
(06:03):
Keep an eye on companies like Oracle , ORCL , given its potential in international deals , and favor AI companies with strong fundamentals and clear paths to profit , rather than just hype .
Third , Consider Fixed Income for Stability , Particularly ShorterDuration Bonds .
With the expected Fed rate cuts , bonds can offer stability and attractive yields .
(06:27):
The 10year US Treasury yield has already dipped to 4.082% .
For broad fixedincome exposure , consider the iShares Core U.S.
Aggregate Bond ETF , AGG , or the Vanguard Total Bond Market ETF , BND .
If you want to capitalize on shortterm rate movements , look into shortterm Treasury ETFs .
(06:51):
Fourth , Monitor Cyclical Sectors with Caution .
While Energy and Materials are strong today , and Consumer Discretionary has performed well , the weakening labor market and potential for slower GDP growth mean caution is warranted .
For those with higher risk tolerance , the Energy Select Sector SPDR Fund , XLE , and the Materials Select Sector SPDR Fund , XLB , could be tactical plays , but always keep an eye on economic data .
Finally , and this is a big one (07:23):
Watch for ' Sell the News ' in RateSensitive Assets .
Since a 25 bps Fed cut is largely priced in , if the actual announcement tomorrow doesn't exceed expectations , we could see a shortterm dip , especially in highly speculative assets like cryptocurrencies .
(07:43):
Longterm investors shouldn't overreact , but traders might consider hedging or reducing exposure to very speculative assets right before the announcement .
To wrap it up , the market is showing incredible resilience , driven by tech and rate cut expectations .
But don't forget those macroeconomic headwinds like the weakening labor market and sticky inflation .
(08:06):
A diversified approach , favoring undervalued segments and staying cautious with highly valued growth , especially around that Fed announcement , is your best bet .
That's all for this edition of Spy Trader !
I'm Marty Marketmover , and I'll catch you next time .
Happy trading !
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