CWS Market Review – October 14, 2025

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In recent issues, I’ve talked about how placid the stock market has been. The S&P 500 just ran off 34 days in a row without a 1% change. That’s the longest such streak in nearly 50 years.

Well, that all came to a crashing end on Friday when the stock market fell 2.7% on news of the Trump administration’s tariff threats.

Interestingly, Friday’s stock drop had a huge divide between—exactly what we’ve been talking about—High Beta and Low Vol stocks. On Friday, the High Beta sector fell about 5% while the Low Vol sector was largely flat. That’s a huge gap.

I knew there was going to be a rotation, but I had no idea when. I’m not ready to proclaim this as the start of a Low Vol rally, but it shows these exact tensions within the market. The High Beta stocks performed well as long as the market did well, and the market did well as long as the economic news was positive.

Investors need to understand how much of the rally has been placed on the shoulders of just a few stocks.

Q3 Earnings Begins

Today was also the first big day of Q3 earnings season. The big banks went first and it looks like Q3 was a good one for Wall Street.

Goldman Sachs (GS) said it made $12.25 per share which beat estimates for $11 per share. That’s an increase of 37% over last year. Revenues climbed 20% to $15.18 billion. That beat estimates for $14.1 billion. Goldman’s investment banking fees increased 42% to $2.66 billion.

One weak spot was Goldman’s equity trading division. Sales rose 7% to $3.74 billion, which was $160 million below the estimate. Revenue at Goldman’s fixed income division rose 17% to $3.47 billion. That topped estimates by $289 million.

Goldman’s stock has done well this year, but the stock fell a little bit in today’s trading.

JPMorgan Chase (JPM) said its Q3 profit rose 12% to $14.39 billion, or $5.07 per share. That beat estimates of $4.84 per share. JPM’s revenues increased 9% to $47.12 billion compared with expectations of $45.4 billion.

I was impressed by JPM’s trading segments. For Q3, JPMorgan’s trading division had revenues of $8.9 billion. Fixed-income trading grew 21% to $5.6 billion. That’s about $300 million more than expected. Equity trading rose 33% to $3.3 billion. That also beat estimates.

JPM’s provision for credit losses rose 9% to $3.4 billion. The estimate was for $3.08 billion. This suggests the banks are getting ready for more defaults.

It appears that the tariff uncertainty has benefited Wall Street. CEO Jamie Dimon said, “While there have been some signs of a softening, particularly in job growth, the U.S. economy generally remained resilient.”

Citigroup (C) has had a very good year and today we saw why. Citi said it made $2.24 per share which beat estimates of $1.90 per share. That’s up 15% over last year. Revenue rose 9% to $22.09 billion which was $1 billion more than expected.

The bank continues to do well. For Q3, Citi’s banking revenues rose 34%. The bank’s services division had revenue growth of 7%. Also, Citi’s market segment posted a revenue increase of 15%.

Shares of BlackRock (BLK) rose to a new all-time high today. The company is the largest money manager in the world. It now has assets under management of $13.46 trillion. That’s up 17% in the last year.

For the quarter, BLK made $11.55 per share which beat Wall Street’s forecast. The shares rallied to a new all-time high.

Shares of Wells Fargo (WFC) rallied more than 7% after the bank reported solid earnings for its Q3. The Federal Reserve lifted WFC’s asset cap of $1.95 trillion. Since 2019, Wells has closed 13 consent orders. It still has one more to go.

CEO Charlie Scharf said, “We are now on a path to grow more broadly with the lifting of the asset cap. “The bank raised its ROE target from 15% to 17% to 18%. WFC’s Q3 profit rose to $5.59 billion, or $1.66 per share. The consensus on Wall Street was for earnings of $1.55 per share.

Wells’s provision for credit losses dropped to $681 million from $1.07 billion last year. WFC’s investment banking fees jumped 25% to a record of $840 million.

Bank of America (BAC) and Morgan Stanley (MS) will report earnings tomorrow.

We’ll also get our first Buy List stock to report earnings tomorrow. Abbott Labs (ABT) is due to report its Q3 earnings before the market opens. I’m curious to hear what Abbott has to say because this is a good company, but the stock has lagged the market for more than five years.

I was happy to see ABT get a boost last summer, but that eventually petered out by the spring. I suspect that a lot of ABT’s lagging is due to it being a healthcare stock. When your sector is out of favor on Wall Street, it’s hard to do well. Abbott has been outperforming healthcare recently.

For Q3, ABT said it expects earnings between $1.28 and $1.32 per share. The consensus on Wall Street is for earnings of $1.30 per share, the exact midpoint. I think Abbott will beat that.

For Q2, Abbott made $1.26 per share, which beat Wall Street’s consensus by one penny per share. Management had told us to expect earnings between $1.23 and $1.27 per share.

Abbott’s Q2 sales were up 7.4% to $11.14 billion, which beat estimates of $11.07 billion. If we only look at organic sales, Q2 sales were up by 6.9%, and if we exclude Covid-related items, sales were up 7.5%.

Abbott sees full-year profits ranging between $5.10 and $5.20 per share. That’s down from the company’s previous guidance of $5.15 to $5.25 per share.

Last year, Abbott made $4.67 per share. That means that at the midpoint of this year’s guidance, Abbott expects double-digit earnings growth.

60 Minutes and 1929

This past weekend, 60 Minutes did a story on the stock market and its resemblance to 1929. These stories annoy me, and I think they’re a disservice to investors.

The 60 Minutes story seems to be a backdoor marketing video for Andrew Ross Sorkin’s new book, 1929.

The gist of the piece is that we’re in a stock market bubble and it’s very similar to the events of—you guessed it—1929.

I hate that this even needs to be said, but the current market isn’t anything like the market of 1929. Just as a reminder, the stock market fell 89% from top to bottom. That’s what we’re talking about when we compared us to 1929.

Many more Americans are invested in the stock market than was the case 100 years ago. There’s no gold standard today. No fixed commissions. There’s a global economy. We have deposit insurance. During the Great Depression, the unemployment rate reached 25%. Today it’s just over 4%.

Bear markets happen. We even had a brief one earlier this year. That’s part of investing. That’s quite a different thing from 1929.

What I find especially annoying is that these stories give the appearance of saying something when they’re not really saying anything. The commentators are careful not to predict anything. No one goes on record. Instead, they say they’re “concerned” about something ominous, but they’re lacking in details.

Here’s a snippet from the broadcast:

Andrew Ross Sorkin: The crazy part about this is from 1928 to September 1929, the stock market was up 90%.

Lesley Stahl: When you say the stock market was way up, immediately I think of now. Are you scared? (We’re not up 90%. Six months ago, the market lost 12% in four days. – Eddy)

ARS: I’m anxious. I’m anxious that we are at prices that may not feel sustainable and what I don’t know is we are either living through some kind of remarkable boom and part of that artificial intelligence and technology and all of that or everything is overpriced. (Then prices come down. It’s not a big deal. – Eddy)

LS: Or we’re reliving…

ARS: …1929.

Oh, brother. Nice leading question there. I agree that things are pricey and I’ve said so, but how exactly are we reliving 1929? Notice how Sorkin says he’s anxious. So what? All investors should be anxious to some extent.

Later Stahl Lesley tells us, “People who didn’t really have much money were lured by Wall Street bankers to invest using a newfangled concept to take on debt called credit.”

I hate to break it to you, Lesley, but credit has been around for a long, long time, and so has margin buying.

The story then takes an expected turn into crypto and lets us know that some meme coins coin may not be 100% above board.

“LS: Do you think that we will have a crash, or not?

ARS: The answer is, we will have a crash. I just can’t tell you when and I can’t tell you how deep. But I can assure you – unfortunately, I wish I wasn’t saying this – we will have a crash.”

Let’s see if I have this right. I assure you that something will happen at some time, but I can’t say what, when or how bad it will be. This tells you nothing about being an investor.

That’s all for now. The retail sales report is due out on Thursday, but it looks like we won’t get it thanks to the shutdown. The inflation report is out next Friday, the 24th, and that also looks to be in jeopardy. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Posted by on October 14th, 2025 at 6:05 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.