As we closed the third quarter of 2025, the U.S. equity markets posted solid gains amid a backdrop of macro uncertainty and evolving leadership themes. Broadly:

· The S&P 500 rose +8.1% in Q3, bringing its year-to-date return to +14.8%[i]
· The Nasdaq Composite, buoyed by technology and AI‐driven stocks, climbed +11.2% in Q3 for a YTD return of 18.1%[ii]
· The Dow Jones Industrial Average advanced more modestly, by approximately +5.2% over the quarter and a YTD return of 8.0%[iii]

After April’s tariff shocks that sent the stock market plunging to the lows of the year after an optimistic start to the year, tariff uncertainty has abated with investors watching closely the stalled-out labor market and inflation that has crept up from its low of 2.3% in April[iv] to 3% as of this writing.

Businesses froze and consumer confidence waned as all waited for more clarity on tariffs to make informed spending plans. Major logistical challenges with supply chains in various countries suddenly anathema to the US government set off a mad scramble to placate, adjust, and figure out who would pay the tariff price increases.

Right now, firms like Goldman Sachs[v] say consumers are likely to pay at least half the cost of the tariffs, with clothing and household items most affected by higher prices. (Affordability was the number one issue in recent state and local elections that led to a Democratic sweep.)

Second quarter earnings came in stronger than expected with the actual rate 11.8% vs expectations of 4.9%.[vi] The third quarter was also much better than expected at 13.1% vs 7.9% expected,[vii] making it nine quarters in a row of increasing earnings.viii Company forward guidance on the whole was positive with Ai leading the charge: the chipmakers Nvidia, Broadcom and AMD, data center plays IBM and Oracle and energy/grid plays GE Vernova, Vistra, and Constellation Energy to name a few. Lots of chatter re Ai being hype and a bubble, but we firmly believe this is a long-tailed, transformational technology that has much more to come.

The Fed has cut interest rates twice this fall, one each in September and October given concerns about a slowing labor market, but so far, it still looks like a no-hire, no-fire environment. However, with the shutdown over, we will begin to see official government data soon which may contradict what we have been seeing from private sources and Fed regional bank surveys. Inflation has crept up, but it is not the runaway inflation we saw due to the severe supply disruptions of the Covid lock-down.

Next year, the recently passed tax bill should bring major benefits to businesses in capex spending, bank deregulation should free up more capital to lend to businesses and consumers leading to more spending, and with consumers still spending, earnings should hold up. Some $40-50T in household net worth has been created since 2019; credit card companies, airlines, travel companies and others of similar ilk are seeing no let-up in spending overall, though by most accounts, the lower income consumer is struggling given higher prices of consumables.

The U.S. equity market has delivered a strong quarter and solid year-to-date return. The combination of resilient earnings, lower inflation and a still-healthy labor market provides a favorable backdrop. That said, elevated valuations and a concentrated leadership mean vigilance remains key.

For BD8 Capital Partners clients, the focus remains on quality companies with solid long-term growth prospects, disciplined risk management, and active adjustment to changing regime signals. The question is no longer whether equities can rise — it’s rather how much upside remains, and what paths could trigger a reversal.

As the CIO of BD8 Capital Partners, I appear on CNBC weekly to talk about stocks and the stock market, as well as on other news outlets, e.g., Bloomberg, and we post frequently on “X” (Twitter), LinkedIn and our BD8 Capital Partners Facebook page so you can follow our market commentary. Our website also has updates and information about the firm (https://bd8cap.com/).

As always, we at BD8 Capital Partners continue to focus on your long-term financial future and planning needs, while managing your investments to help meet your financial goals.
Thank you for your continued trust. We look forward to navigating the remainder of the year with a measured, informed approach.

Warmest regards,
Barb

The content of this article is for informational purposes only and should not be considered a recommendation of any particular security, strategy, investment product or investing advice of any kind. There are risks associated with investing, including the entire loss of principal invested. Past performance does not guarantee future results. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the opinions of Spire Wealth Management, LLC, Spire Securities, LLC or its affiliates. Spire Wealth Management, LLC is a Federally Registered Investment Advisory Firm. Securities offered through an affiliated company, Spire Securities, LLC a Registered Broker/Dealer and member FINRA/SIPC.

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i. https://www.cbbank.com/news-media/market-perspective-third-quarter-2025/
ii. https://www.Nasdaq.com
iii. https://www.lpl.com/research/blog/q3-recap-10-key-takeaways.html?utm_source=chatgpt.com
iv. https://www.bls.gov/opub/ted/2025/consumer-prices-up-2-3-percent-from-april-2024-to-april-2025.htm
v. https://www.msn.com/en-us/money/markets/goldman-says-americans-will-pay-most-of-trump-s-tariffs/ar-AA1PVJxn
vi. https://insight.factset.com/sp-500-earnings-season-update-august-8-2025
vii. https://advantage.factset.com/hubfs/Website/Resources%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_111425.pdf?utm_source=chatgpt.com

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