Shesa's Weekend Update - 9|14|25

Welcome to Shesa's weekend update

Last week, the U.S. stock market indexes  posted gains despite mixed economic data. The S&P 500 rose 1.75%, closing at 6,584.29, with a record high of 6,587.47 on Thursday, NASDAQ surged 2.92%, ending at 22,141.10, achieving five consecutive record closes, driven by AI optimism and big run on Oracle and Tesla stock, followed by anticipations of Fed rate cuts this week. The Dow gained 1.02%.

Weak labor market data, including a 911,000 downward revision in jobs from April 2024 to March 2025 was a big blow. The jobless claims reached 263,000 (highest since October 2021). Despite these bad data the stock market had a fantastic week fueled by rate-cut hopes. Inflation data was mixed: August CPI rose 2.9% year-over-year, above the Fed’s 2% target, but PPI unexpectedly declined 0.1% month-over-month, up 2.6% YoY. Gold hit a record $3,681 per ounce, up 10% over four weeks. The Treasury yields fell, with the 10-year at 4.07% and the 2-year at 3.70%.

Some Stock News

Nebius (NBIS) stuck an AI infrastructure deal is with Microsoft valued at $17.4 billion over five years.h This company was added to my blog portfolio last week. I strongly believe that this company has great potential as long as AI growth continues. Hence, I feel it to be good investment for patience long term investors.

Oracle (ORCL) missed both top and bottom line but it said its contracted revenue now stands at $455 billion, up some 359% from a year earlier. Oracle’s generated $3.3 billion in revenue from cloud infrastructure, up 55% vs. 52% last quarter. This news exploded Oracle stock and went up 36%. The stock has pulled back since then. It may be worth putting it on the list to buy on dip. 

Tesla (TSLA) stock is on fire this month and has gone up about 20% or $68 in September itself. Many investors would be thinking that it’s a hype. Well there could be some truth to this. But if you remember, I had written why Tesla is one of my TOP investment a few months ago. I also told during my previous investment meets. Please note that Wall Street is forward looking, not backward looking. That's a reason why Oracle stock exploded upwards despite missing top and bottom line. If we want to beat the market then, we have to think out of box, not what people are saying or Analysts are saying or what media is saying. We must do our due diligence and apply our knowledge and experience. So, bottom line, listen to all but make your own decision looking to the future not the past. That's my own experience.

So, why did Tesla go up som much this month? Here are some of my thoughts:

Board proposes $1T Musk pay package (423.7M shares, tied to 20M vehicles/1M robots/1M robotaxis by 2035.

AI5 chip reveal: 40x performance vs. AI4; mass production 2026.

Expectations of FED 0.25 rate cut that should help car companies

Potential Short squeeze

September 30 EV credit end of $7500 bringing lots of crowd. 

Apple (AAPL) unveiled the iPhone 17 series: iPhone 17, iPhone 17 Air, iPhone 17 Pro, and iPhone 17 Pro Max. The iPhone 17 Air is the thinnest at 5.5mm. All models feature 120Hz OLED displays, A19 chips, and improved cameras, with Pro models offering up to 8× optical zoom. Battery sizes are upgraded. They also introduced Apple Watch Series 11. Honestly, after the demise of Steve Job, Apple seems to have forgotten innovation! Same recycling with some improvements on speed, size, color, memory etc. etc.. AI has been moving at the fastest pace but Apple has been lagging for last couple of years. Unless, they come out with some better products or make better use of AI to excite people, it does not make sense to upgrade phones. Hence, it's worth looking other Mag 7 stocks or other growth stocks rather than hanging in with Apple in a trading range. 

Federal Reserve

The Federal Reserve (FOMC) meets on Wednesday, 9/17. It’s highly anticipated for a 0.25% rate cuts. I did a poll in my WhatsApp group and more than 80% participants thought FED will cut 0.25% rate. I agree with 0.25% rate cut this week.  There is inflation concern but the job market has been deteriorating. The home market is doomed. Hence, Wall Street is almost certain for a 0.25% rate cuts. Basically, 0.25% rate cut has been factored into the stock market. But the most important thing will be what FED say about future rate cuts. That would be the KEY market mover. Having said that, the FED may also discuss whether they can cut 0.5%. I may not be surprised if that happens, though I am not very optimistic. In case, there is 0.5% cut this week then this September tend may be reversed and become rosy for the bulls. 

What to expect this week

If there is rate cut, the equity market may continue to do well, particularly AI related and small cap stocks. But if the inflation keeps ticking up then further rate cuts may not happen. If so, market may see some pullbacks. That being said, it's better to have some CASH and list of good stocks that can be bought on the dip. 

After the huge run of Oracle stock, I heard from some of the friends that president Trump is influencing the stock market. Well, I do not know whether that's true or not but let's not forget that he is also getting trillion of dollars of investments into U.S. He is trying to make U.S the leading players on the AI front. His words/tweets were effective to move the stock market comparing to many other earlier presidents. These are all helping the U.S stock market. We are investors, not politicians. If it helps our investment, we should be happy. If we keep complaining, I don't think it's going to help us in our investing, rather we should grab the opportunity to make some money by following what's working in the market. This is just my view as an investor. This week, the U.S and China delegation began talks on Madrid to discuss security, economic and trade issues. Also, they are expected to talk about TikTok.

Economic News this week

TUE, 9/16: U.S retail sales.

WED, 9/17: FOMC Rate Cut decision => Market moving event

Stocks to watch

TSLA, AVGO, HOOD, ORCL, NBIS, CRWV, META, CVNA, OPEN, IONQ, TEM, NVDA, HIMS, ALAB, RDDT, APLD, RKT, MSFT, ENVX.

Have a good evening!