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Tag: Stocks and bonds

  • Regional banks’ bad loans spark concerns on Wall Street

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    NEW YORK — NEW YORK (AP) —

    Wall Street is concerned about the health of the nation’s regional banks, after a few of them wrote off bad loans to commercial customers in the last two weeks and caused investors to wonder if there might be more bad news to come.

    Zions Bank, Western Alliance Bank and the investment bank Jefferies surprised investors by disclosing various bad investments on their books, sending their stocks falling sharply this week. JPMorgan Chase CEO Jamie Dimon added to the unease when he warned there might be more problems to come for banks with potentially bad loans.

    “When you see one cockroach, there are probably more,” Dimon told investors and reporters on Tuesday, when JPMorgan reported its results.

    The KBW Bank Index, a basket of banks tracked by investors, is down 7% this month.

    There were other signs of distress. Data from the Federal Reserve shows that banks tapped the central bank’s overnight “repo” facilities for the second night in a row, an action banks have not needed to take since the Covid-19 pandemic. This facility allows banks to convert highly liquid securities like mortgage bonds and treasuries into cash to help fund their short-term cash shortfalls.

    Zions Bancorp shares sank Thursday after the bank wrote off $50 million in commercial and industrial loans, while Western Alliance fell after the bank alleged it had been defrauded by an entity known as Cantor Group V LLC. This came on top of news from Jefferies, which told investors it was holding $5.9 billion in debt of bankrupt auto parts company First Brands. All three stocks recovered a bit by midday Friday.

    Even larger banks were not immune. Several Wall Street banks disclosed losses in the bankruptcy of Tricolor, a subprime auto dealership company that collapsed last month. Fifth Third Bank, a larger regional bank, recorded a $178 million loss from Tricolor’s bankruptcy.

    While the big Wall Street banks get most of the media and investor attention, regional banks are a major part of the economy, lending to small-to-medium sized businesses and acting as major lenders for commercial real estate developers. There are more than 120 banks with between $10 billion and $200 billion in assets, according to the FDIC.

    While big, these banks can run into trouble because their businesses are not as diverse as the Wall Street money center banks. They’re often more exposed to real estate and industrial loans, and don’t have significant businesses in credit cards and payment processing that can be revenue generators when lending goes south.

    The last banking flare up, in 2023, also involved mid-sized and regional banks that were overly exposed to low-interest loans and commercial real estate. The crisis caused Silicon Valley Bank to fail, followed by Signature Bank, and led to the eventual sale of First Republic Bank to JPMorgan Chase in a fire sale. Other banks like Zions and Western Alliance ended up seeing their stocks plummet during that time period.

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  • World shares retreat after worries over bank lending pull Wall Street lower

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    MANILA, Philippines — MANILA, Philippines (AP) — World shares skidded Friday following a retreat on Wall Street driven by concerns over banks’ loan portfolios.

    The future for S&P 500 fell 1.3% while that for the Dow Jones Industrial Average shed 1%. Oil prices were lower while the price of gold climbed to over $4,383 an ounce, and was last trading at $4,356.50 per ounce, as Washington and Beijing swapped harsh words over trade.

    In early European trading, a sell-off of bank and financial shares weighed on regional indexes. Germany’s DAX slumped 2% to 23,783.64. Britain’s FTSE 100 fell 1.5% to 9,293.24 while in Paris, the CAC 40 shed nearly 0.8% to 8,126.52.

    In Asia, Japan’s Nikkei 225 fell 1.4% to 47,582.15, tracking U.S. losses. Uncertainty over the choice of a new prime minister has also weighed on investor sentiment.

    Conservative lawmaker Sanae Takaichi was elected to head the ruling Liberal Democratic Party but last week’s collapse of its coalition with the Buddhist-backed Komeito cast doubt over whether she would garner enough support in the lower house of parliament to prevail in a vote expected next week.

    Takaichi has led efforts to form a new alliance with the Osaka-based Japan Innovation Party, which would improve her chances of becoming Japan’s first female prime minister.

    In Chinese markets, shares fell as trade tensions with Washington intensified. Hong Kong’s Hang Seng index slumped 2.5% to 25,247.10, while the Shanghai Composite index slid nearly 2% to 3,839.76.

    Traders also remained cautious ahead of Monday’s release of economic data and an important meeting of the ruling Communist Party leadership next week.

    South Korea’s Kospi closed nearly flat at 3,748.89, erasing earlier gains amid optimism over progress in trade talks with the U.S.

    Data released on Friday showed South Korea’s seasonally adjusted unemployment rate slid to 2.5% in September from 2.6% in August.

    Australia’s S&P/ASX 200 lost 0.8% to 8,995.30, retreating from the previous day’s record high. Energy and tech stocks led the decline.

    Taiwan’s Taiex dropped nearly 1.3% while in India, the Sensex rose 0.4%.

    On Wall Street, stocks fell Thursday as worries flared over the financial health of midsized banks.

    The S&P 500 slid 0.6% to 6,629.07, in its latest up-and-down day. The Dow Jones Industrial Average dropped 0.7% to 45,952.24, and the Nasdaq composite lost 0.5% to 22,562.54.

    Salt Lake City-based Zions Bancorp. tumbled 13.1% after the bank said its profit for the third quarter will take a hit because of a $50 million charge-off related to loans made to a pair of borrowers. Zions said it found “apparent misrepresentations and contractual defaults” by the borrowers and several people who guaranteed the loans, along with other irregularities.

    Another bank, Western Alliance Bancorp, dropped 10.8% after saying it has sued a borrower, alleging fraud. It also said it’s standing by its financial forecasts given for 2025.

    Scrutiny is rising on the quality of loans that banks and other lenders have broadly made following last month’s Chapter 11 bankruptcy protection filing of First Brands Group, a supplier of aftermarket auto parts. The question is whether the hiccups are just a collection of one-offs or a signal of something larger threatening the industry.

    “The Street’s been dining on rate cut and AI optimism for months, but this week the waiter brought something no one ordered: the return of the credit bogeyman,” Stephen Innes of SPI Asset Management said in a commentary.

    “Regional banks have become the canaries in the credit coal mine, and their chirping sounds suspiciously weak,” he said.

    U.S. companies broadly are under pressure to deliver stronger profits after the S&P 500 surged 35% from a low in April. To justify those gains, which critics say made their stock prices too expensive, companies will need to show they’re making much more in profit and will continue to do so.

    In other dealings on Friday, benchmark crude oil lost 61 cents to $56.85 per barrel. Brent crude, the international standard, gave up 64 cents to $60.42 per barrel.

    The U.S. dollar fell to 149.70 Japanese yen from 150.44 yen. The euro rose to $1.1703 from $1.1688.

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  • Slowdown in US hiring suggests economy still needs rate cuts, Fed’s Powell says

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    WASHINGTON (AP) — A sharp slowdown in hiring poses a growing risk to the U.S. economy, Federal Reserve Chair Jerome Powell said Tuesday, a sign that the Fed will likely cut its key interest rate twice more this year.

    Powell said in a speech in Philadelphia that despite the federal government shutdown cutting off official economic data, “the outlook for employment and inflation does not appear to have changed much since our September meeting,” when the Fed reduced its key rate for the first time this year.

    Fed officials at that meeting also forecast that the central bank would reduce its rate twice more this year and once in 2026. Lower rates from the Fed could reduce borrowing costs for mortgages, car loans, and business loans. Powell spoke before a meeting of the National Association of Business Economics.

    Powell reiterated a message he first delivered after the September meeting, when he signaled that the Fed is slightly more worried about the job market than its other congressional mandate, which is to keep prices stable. Tariffs have lifted the Fed’s preferred measure of inflation to 2.9%, he said, but outside the duties there aren’t “broader inflationary pressures” that will keep prices high.

    “Rising downside risks to employment have shifted our assessment of the balance of risks,” he said.

    Economists said Powell’s remarks solidified expectations for further rate cuts, starting at its next meeting Oct. 28-29.

    “While there was little doubt the (Fed) was angled to cut rates at its next meeting, today’s remarks were strong confirmation of that expectation,” Michael Feroli, chief U.S. economist at JPMorgan Chase, said in a note to clients.

    Powell also said that the central bank may soon stop shrinking its roughly $6.6 trillion balance sheet. The Fed has been allowing roughly $40 billion of Treasuries and mortgage-backed securities to mature each month without replacing them.

    “We may approach that point in coming months,” Powell said.

    The shift could slightly lower borrowing costs over time. Economists at BMO Capital Markets estimated that the yields on Treasury securities ticked down slightly after Powell’s remarks.

    Separately, Powell spent most of his speech defending the Fed’s practice of buying longer-term Treasury bonds and mortgage-backed securities in 2020 and 2021, which were intended to lower longer-term interest rates and support the economy during the pandemic.

    Yet those purchases have come under a torrent of criticism from Treasury Secretary Scott Bessent, as well as some of the candidates floated by the Trump administration to replace Powell when his term as Chair ends next May.

    Bessent said in an extended critique published earlier this year that the huge purchases of bonds during the pandemic worsened inequality by boosting the stock market, without providing noticeable benefits to the economy.

    Other critics have long argued that the Fed kept implementing the purchases for too long, keeping interest rates low even as inflation began to spike in late 2021. The Fed beginning in 2021 stopped the purchases and then sharply boosted borrowing costs to combat inflation.

    “With the clarity of hindsight, we could have—and perhaps should have—stopped asset purchases sooner,” Powell said. “Our real-time decisions were intended to serve as insurance against downside risk.”

    Yet Powell said that moving earlier would not have prevented the COVID-era inflation spike: “Stopping sooner could have made some difference, but not likely enough to fundamentally alter the trajectory of the economy.”

    Powell also said the purchases were intended to avoid a breakdown in the market for Treasury securities, which could have sent interest rates much higher.

    The Fed chair also addressed a move by a bipartisan group of senators to stop the central bank from paying interest on the cash reserves banks park at the Fed. A measure to prevent the Fed from doing so was defeated in the Senate last week by the lopsided vote of 83-14.

    Still, it garnered support from both parties, including Republican senators Rand Paul from Kentucky and Ted Cruz from Texas, as well as Massachusetts Democratic Sen. Elizabeth Warren.

    Powell said that without the ability to pay interest on reserves, the Fed “would lose control over rates” and wouldn’t be able to carry out its mission. The Fed lifts the short-term interest rate it controls when it wants to cool borrowing and spending and slow inflation, while it cuts the rate to encourage borrowing, growth, and hiring.

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  • How major US stock indexes fared Thursday, 10/16/2025

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    Stocks slumped after another turbulent day of trading

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  • Asian shares are mostly higher after Wall St ends an erratic day with gains

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    MANILA, Philippines — MANILA, Philippines (AP) — Most Asian stock indexes rose on Thursday, tracking gains on Wall Street following a topsy-turvy trading day.

    U.S. futures were nearly flat, while oil prices were higher.

    Japan’s Nikkei 225 rose 0.8% to 48,069.71 as investor sentiment was lifted by a strong start to the earnings season and expectations of U.S. rate cuts.

    Japan’s core machinery orders, excluding ships and electric power, fell 0.9% month-on-month in August, missing market expectations for a 0.4% gain but showing marked improvement from a 4.6% drop in July, according to data released Thursday.

    South Korea’s Kospi surged to a record high, adding 1.8% to 3,722.67 on buying of tech and auto stocks that was spurred by expectations that the U.S. and Korea are getting closer to a deal on tariffs on Korean exports. Samsung Electronics and automakers Hyundai Motor and Kia Corp. were among gainers.

    In Chinese markets, Hong Kong’s Hang Seng index shed 0.4% to 25,799.27, while the Shanghai Composite index rose 0.1% to 3,916.10.

    Australia’s S&P/ASX 200 climbed 8% to 9,063.70, breaching the 9,000 level for the first time amid gains in gold stocks. Miners in resource-rich Australia are benefitting from a runup in gold prices. Early Thursday, the precious metal was up 1.2% at 4,252.30 per ounce.

    Also, the jobless rate rose to 4.5% in September, the highest in four years, stepping up expectations that the country’s Reserve Bank may resume rate cuts as early as next month.

    India’s BSE Sensex added 0.5% while Taiwan’s Taiex advanced 1.5%.

    On Wednesday, most U.S. stocks rose. The S&P 500 added 0.4% to 6,671.06, but only after jumping toward one of its biggest gains since the summer, erasing it all and then climbing back.

    The Nasdaq composite climbed 0.7%, closing at 22,670.08 after earlier pinballing between a drop of 0.4% and a rally of 1.4%. The Dow Jones Industrial Average lagged the market, shedding less than 0.1% to 46,253.31.

    Technology stocks helped lead the way Wednesday following a better-than-expected profit report from Netherlands-based ASML, a major equipment supplier to the semiconductor industry. It expects its revenue for 2025 to be 15% above last year’s, while next year’s should be at least as high as this year’s. Several big banks also drove the market higher.

    Companies are under pressure to deliver strong profits after their stock prices broadly surged 35% from a low in April. To justify those gains, which critics say made their stock prices too expensive, companies will need to show they’re making much more in profit and will continue to do so.

    Profit reports are under more scrutiny than usual as investors seek insights into the health of the U.S. economy. The U.S. government’s latest shutdown is delaying important updates on the economy, such as a report on inflation that was due Wednesday.

    In other dealings early Thursday, U.S. benchmark crude oil gained 58 cents to $58.85 per barrel. Brent crude, the international standard, rose 55 cents to $62.46 per barrel.

    The dollar rose to 151.07 Japanese yen from 151.06 yen. The euro climbed to $1.1658 from $1.1648.

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    AP Business Writers Stan Choe and Matt Ott contributed.

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  • Asian shares are mixed and US futures little changed after Wall St rally

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    TOKYO — TOKYO (AP) — Asian shares were trading mixed on Tuesday after a rally on Wall Street spurred by U.S. President Donald Trump’s reassurances over relations with China.

    Japan’s benchmark Nikkei 225 slipped 1.4% to 47,419.87, as trading resumed following a national holiday Monday.

    In Hong Kong, the Hang Seng lost 0.4% to 25,788.44, while the Shanghai Composite edged up 0.2% to 3,897.56.

    “Don’t worry about China,” Trump said on his social media platform Sunday. He also said that China’s leader, Xi Jinping, “doesn’t want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!!!”

    On Friday, the S&P 500 tumbled to its worst drop since April after he accused China of “ a moral disgrace in dealing with other Nations.” He also threatened much higher tariffs on Chinese goods.

    Still, the status of trade talks between the two biggest economies remains unclear. Despite harsh rhetoric and fresh retaliatory moves on tariffs and export controls, Trump said he still may meet with Chinese leader Xi Jinping later this month on the sidelines of a regional summit.

    Australia’s S&P/ASX 200 edged 0.1% lower to 8,876.20. South Korea’s Kospi gained 0.6% to 3,605.10.

    The S&P 500 jumped 1.6% in its best day since May, closing at 6,654.72. It recovered just over half its drop from Friday. The Dow Jones Industrial Average climbed 1.3% to 46,067.68, and the Nasdaq composite leaped 2.2% to 22,694.61.

    The down-and-up moves for the market echoed its manic swings during April, when Trump shocked investors with his “Liberation Day” announcement of worldwide tariffs. He eventually relented on many to give time to negotiate trade deals.

    “After the sharp lurch in U.S. equities on Friday — the worst since the “Liberation Day” tariff shock — markets have delivered a relief rebound — arguably regaining confidence even,” Mizuho Bank said in a commentary.

    Trump’s wavering on tariffs has helped stocks soar since April. So have expectations for several cuts to interest rates by the Federal Reserve to help the economy.

    Critics say the market now looks too expensive now after prices rose much faster than corporate profits. Worries are particularly high about companies in the artificial-intelligence industry, where pessimists hear echoes of the 2000 dot-com bubble that imploded.

    Broadcom jumped 9.9% for one of Monday’s biggest gains in the S&P 500 after announcing a collaboration with OpenAI. Broadcom will help develop and deploy custom AI accelerators that the maker of ChatGPT will design.

    For stocks to look less expensive, either prices need to fall, or companies’ profits need to rise.

    That’s raising the stakes for the upcoming earnings reporting season, with big U.S. companies lined up to say how much profit they made during the summer. JPMorgan Chase, Johnson & Johnson and United Airlines are some of the big names on the calendar this coming week.

    Fastenal tumbled 7.5% for the largest loss in the S&P 500 after the maker of fasteners and safety supplies reported a profit for the latest quarter that was slightly weaker than analysts expected.

    In other dealings early Tuesday, benchmark U.S. crude added 20 cents to $59.69 a barrel. Brent crude, the international standard, gained 21 cents to $63.53 a barrel.

    In currency trading, the U.S. dollar fell to 152.13 Japanese yen from 152.29 yen. The euro cost $1.1581, up from $1.1569.

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    AP Business Writers Matt Ott and Stan Choe contributed.

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  • Asian shares skid after Wall Street tumbles to its worst day since April as China trade woes worsen

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    BANGKOK — BANGKOK (AP) — Asian shares tumbled on Monday as escalating trade tensions with China shattered a monthslong calm on Wall Street.

    U.S. stocks skidded on Friday after President Donald Trump threatened to crank tariffs higher on China, signaling more trouble ahead between the two biggest economies. He was responding to restrictions Beijing is imposing on exports of rare earths, which are materials that are critical for the manufacturing of everything from consumer electronics to jet engines.

    But U.S. futures advanced, with the contract for the S&P 500 gaining 1.4% while that for the Dow Jones Industrial Average gained 1%.

    China reported its global exports rose 8.3% in September from a year earlier, the strongest growth in six months and further evidence that its manufacturers are shifting sales from the U.S. to other markets.

    Exports to the U.S. tumbled 27% year-on-year last month, customs data showed.

    In Hong Kong, the Hang Seng sank 2.2% to 25,700.07.

    Most other major regional markets logged losses of more than 1%.

    The Shanghai Composite index edged 0.2% lower to 3,889.50 and the Kospi in South Korea gave up 0.7% to 3,584.55.

    Australia’s S&P/ASX 200 declined 0.8% to 8,882.80. Taiwan’s Taiex shed 1.4% and India’s Sensex was down 0.4%.

    Markets in Tokyo were closed for a holiday.

    On Friday, the S&P 500 sank 2.7% in its worst day since April, closing at 6,552.51. The Dow Jones Industrial Average dropped 1.9% to 45,479.60, and the Nasdaq composite lost 3.6% to 22,204.43.

    The setback reflected signs of a re-escalation of the trade war.

    “We have been contacted by other Countries who are extremely angry at this great Trade hostility, which came out of nowhere,” Trump wrote on Truth Social, alluding to Beijing. He also said “now there seems to be no reason” to meet with China’s leader, Xi Jinping, after earlier agreeing to do so as part of an upcoming trip to South Korea.

    Roughly six out of every seven stocks within the S&P 500 fell. Nearly everything weakened, from Big Tech companies like Nvidia and Apple to stocks of smaller companies looking to get past uncertainty about tariffs and trade.

    The market may have been primed for a slide. U.S. stocks were already facing criticism that their prices had shot too high following the S&P 500’s nearly relentless 35% run from a low in April. The index, which dictates the movements for many 401(k) accounts, is still near its all-time high set earlier in the week.

    Critics say the market looks too expensive after prices rose much faster than corporate profits. Worries are particularly high about companies in the artificial-intelligence industry, where pessimists see echoes of the 2000 dot-com bubble that imploded. For stocks to look less expensive, either their prices need to fall, or companies’ profits need to rise.

    In the bond market, the yield on the 10-year Treasury sank to 4.05% from 4.14% late Thursday.

    It had already been lower before Trump made his threats, as a report from the University of Michigan suggested that sentiment among U.S. consumers remains in the doldrums.

    Some of Friday’s strongest action was in the oil market, where the price of a barrel of benchmark U.S. crude sank 4.2% to $58.90.

    It fell as a ceasefire between Israel and Hamas came into effect in Gaza. An end to the war could remove worries about disruptions to oil supplies, which had kept crude’s price higher than it otherwise would have been.

    Losses accelerated following Trump’s tariff threat, which could gum up global trade and lead the economy to burn less fuel.

    Brent crude, the international standard, dropped 3.8% to $62.73 per barrel. However, early Monday it was trading 85 cents higher at $63.58 per barrel. U.S. benchmark crude oil gained 72 cents to $59.62 per barrel.

    In other dealings early Monday, the dollar rose 152.22 Japanese yen from 151.89 yen late Friday. The euro fell to $1.1605 from $1.1614.

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  • Asian shares are mostly lower following Wall Street’s pause from its feverish rally

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    MANILA, Philippines — MANILA, Philippines (AP) — Asian shares mostly fell on Friday, after a respite from Wall Street’s recent feverish rally. The price of gold also pulled back from record highs following recent torrid runs.

    U.S. futures and oil prices were higher.

    Nealy all Asian indexes were down, with the exception of South Korea’s Kospi, which climbed 1.3% to 3,596.36 as trading reopened after a holiday.

    The surge was fueled by a rally of tech shares including SK Hynix, which was up nearly 7%. Samsung Electronics rose 5.4%, boosted by news that Nvidia-backed Reflection AI had raised $2 billion, raising its market value to $8 billion.

    Japan’s Nikkei 225 fell 1% to 48,087.75, pulling back from big gains the previous day after data showed producer prices rose more than expected in September.

    Hong Kong’s Hang Seng index shed 0.8% to 26,534.65, while the Shanghai Composite index slipped 0.5% to 3,913.98.

    Australia’s S&P/ASX 200 slid 0.1% to 8,959.80. Taiwan’s stock market was closed for a holiday.

    On Thursday, the S&P 500 slipped 0.3% from its latest all-time high for just its second loss in the last 10 days, closing at 6,735.11. The Dow Jones Industrial Average dropped 0.5% to 46,358.42, and the Nasdaq composite edged down by 0.1% to 23,024.63.

    Gold also fell following its stellar rally this year, losing 2.4% to drop back below $4,000 per ounce, while Treasury yields held relatively steady in the bond market. They’re taking a moment following big runs driven in large part by expectations that the Federal Reserve will cut interest rates to support the economy.

    Financial markets have been climbing so relentlessly, including a 35% leap for the S&P 500 from a low in April, that worries are mounting that prices may have shot too high. Concerns are particularly strong about the frenzy lifting stocks related to artificial-intelligence technology.

    Dell Technologies sank 5.2% for the biggest loss in the S&P 500, but that only trimmed its surge since talking up its AI growth opportunities at an investment conference earlier in the week. The stock was still up nearly 11% for the week so far.

    Tesla also weighed on the market after falling 0.7%. The National Highway Traffic Safety Administration opened a preliminary evaluation of its “Full Self-Driving” system due to safety concerns.

    Those losses helped offset a 4.3% ascent for Delta Air Lines, which reported a stronger profit for the summer than analysts expected.

    Delta also forecasted a range for profit during the year’s final three months whose midpoint topped analysts’ estimates. Its president, Glen Hauenstein, highlighted a broad-based acceleration in sales trends over the last six weeks, including for domestic business travel.

    Such corporate reports have gained importance since they offer insights into the strength of the U.S. economy after U.S. government shutdown is delayed reports that usually serve that purpose. This is the second week where the U.S. government has not published its update on unemployment claims, for example, a report that usually helps guide Wall Street’s trading each Thursday.

    In other dealings early Friday, U.S. benchmark crude oil added 10 cents to $61.61 per barrel. Brent crude, the international standard, edged up 5 cents to $65.27 per barrel.

    The U.S. dollar fell to 152.74 Japanese yen from 153.05 yen. The euro rose to $1.1572 from $1.1569.

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    AP Business Writers Stan Choe and Matt Ott contributed.

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  • PepsiCo reports strong third quarter sales despite weakening demand in North America

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    PepsiCo reported better-than-expected revenue in the third quarter despite weaker demand for its snacks and drinks in North America.

    Revenue rose 2.6% to $23.94 billion in the July-September period. That was better than the $23.84 billion Wall Street was expecting, according to analysts polled by FactSet.

    In North America, PepsiCo said sales volumes for its Frito-Lay snacks and other foods fell 2% in the quarter while sales volumes for its beverages were down 3%. Sales volumes were higher in Latin America and Asia.

    PepsiCo said earlier this year that inflation and changing consumer preferences have weakened demand for the company’s drinks and snacks. The company has been trying to combat perceptions that its products are too expensive by expanding distribution of value brands like Chester’s and Santitas. It is also accelerating a shift to remove artificial colors from its products.

    Net income fell 11% to $2.6 billion. Adjusted for one-time items, the company earned $2.29 per share. That also beat analysts’ forecasts of $2.26.

    The company, based in Purchase, New York, has been under some pressure from Elliott Investment Management, an activist investor that recently took a $4 billion stake in PepsiCo.

    In a letter sent to PepsiCo’s board last month, Elliott said the company has been hurt by loss of market share in its North American beverage business and slowing growth and weaker profits in its North American food business.

    Elliott wants PepsiCo to slim down its food and beverage portfolio so it can reinvest in core brands like Mountain Dew or new products like protein snacks. It also wants the company to consider refranchising its North American bottlers, an action that its rival Coca-Cola took in 2017.

    Shares of PepsiCo Inc. are up a fration before the opening bell.

    Also on Thursday, PepsiCo named Walmart executive Steve Schmitt as its new chief financial officer. Schmitt was the CFO for Walmart’s U.S. division.

    Current PepsiCo CFO Jamie Caulfield plans to retire on Nov. 10 after more than 30 years with the company. He will remain at PepsiCo until May 15 in an advisory role.

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  • Is there an AI bubble? Financial institutions sound a warning

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    LONDON — LONDON (AP) — Lingering doubts about the economic promise of artificial intelligence technology are starting to get the attention of financial institutions that raised warning flags this week about an AI investment bubble.

    Officials at the Bank of England on Wednesday flagged the growing risk that tech stock prices pumped up by the AI boom could burst.

    “The risk of a sharp market correction has increased,” the U.K. central bank said.

    The head of the International Monetary Fund raised a similar alarm hours after the Bank of England’s report.

    Global stock prices have been surging, fired up by “optimism about the productivity-enhancing potential of AI,” IMF Managing Director Kristalina Georgieva said.

    But financial conditions could “turn abruptly,” she warned in a speech ahead of the organization’s annual meeting next week in Washington.

    “Bubbles obviously are never very easy to identify, but we can see there are a few potential symptoms of a bubble in the current situation,” said Adam Slater, lead economist at Oxford Economics.

    Those symptoms include rapid growth in tech stock prices, the fact that tech stocks now comprise about 40% of the S&P 500, market valuations that appear “stretched” beyond their worth and “a general sense of extreme optimism in terms of the underlying technology, despite the enormous uncertainties around what this technology might ultimately yield,” Slater said.

    The most optimistic projections about the fruits of generative AI products foresee a transformation of the economy, leading to annual productivity gains that Slater says have not been seen since the reconstruction of Europe after World War II. At the lower end, economist Daron Acemoglu of the Massachusetts Institute of Technology has predicted a “nontrivial but modest” U.S. productivity gain of just 0.7% over a decade.

    “You’ve got this incredibly wide range of possibilities,” Slater said. “Nobody really knows where it’s going to land.”

    Investors have closely watched a series of intertwined deals over recent months between top AI developers such as OpenAI, maker of ChatGPT, and the companies building the costly computer chips and data centers needed to power these AI products.

    OpenAI doesn’t turn a profit but the privately held San Francisco firm is now the world’s most valuable startup, with a market valuation of $500 billion. It recently signed major deals with chipmaker Nvidia, the world’s most valuable publicly traded company, and its rival AMD.

    The Bank of England didn’t name any specific companies but said that on “a number of measures, equity market valuations appear stretched, particularly for technology companies focused on Artificial Intelligence.”

    The report said stock market valuations are “comparable to the peak” of the 2000 dotcom bubble, which then deflated and led to a recession. With tech stocks accounting for an increasingly large share of benchmark stock indexes, stock markets are “particularly exposed should expectations around the impact of AI become less optimistic.”

    The bank outlined so-called downside risks, including shortages of electricity, data or chips that could slow AI progress, or technological changes that could lessen the need for the type of AI infrastructure currently being built around the world.

    The IMF’s Georgieva said current stock valuations “are heading toward levels we saw during the bullishness about the internet 25 years ago. If a sharp correction were to occur, tighter financial conditions could drag down world growth,” she said.

    Tech company bosses are downplaying the doomsayers.

    The current AI boom is an industrial, rather than financial or banking, bubble and will be beneficial for society even if it bursts, Amazon founder Jeff Bezos said.

    “The ones that are industrial are not nearly as bad. It could even be good because when the dust settles and you see who are the winners, society benefits from those inventions,” Bezos said at a recent tech conference in Italy.

    He compared it to a previous biotech bubble in the 1990s that resulted in new life-saving drugs.

    The excitement around AI is drawing in a huge wave of money to fund new business ideas, but it’s also clouding investors’ judgment, Bezos said.

    “Every company gets funded, the good ideas and the bad ideas. And investors have a hard time in the middle of this excitement distinguishing between the good and bad ideas and so that’s also probably happening today,” he said.

    On a tour last month of a Texas data center, OpenAI CEO Sam Altman predicted people will “make some dumb capital allocations” and there will be short-term ups and downs of overinvestment and underinvestment.

    But he added that “over the arc that we have to plan over, we are confident that this technology will drive a new wave of unprecedented economic growth,” along with scientific breakthroughs, improvements to quality of life and “new ways to express creativity.”

    Nvidia CEO Jensen Huang acknowledged in a CNBC interview on Wednesday that OpenAI doesn’t yet have the money to buy its chips, but “they’re going to have to raise that money” through revenue, which “is growing exponentially,” along with equity or debt.

    Huang said he also believes a transition has happened as leading AI developers are moving from chatbots that operated “basically at a loss” because the models “weren’t useful enough” to one in which the AI systems are capable of higher-level reasoning.

    “It’s doing research before it answers a question,” he said. “It goes on the web and studies other PDFs and websites, it can now use tools, generate information for you, and it creates responses that are really useful.”

    AI companies have spent more than a year pitching the transformative potential of “AI agents” that can go beyond a chatbot’s capability by being able to access a person’s computer and do coding and other work tasks on their behalf. But as the initial hype fades, Forrester analyst Sudha Maheshwari said businesses looking to buy these AI tools are taking a closer look at whether they’re getting enough return on their investments.

    “Every bubble inevitably bursts, and in 2026, AI will lose its sheen, trading its tiara for a hard hat,” she wrote in a report Wednesday.

    ——

    O’Brien reported from Providence, Rhode Island and Abilene, Texas.

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  • Japan’s Nikkei stock index jumps nearly 5% after its ruling party picked Takaichi to lead

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    Japan’s Nikkei stock index jumped nearly 5% on Monday and the yen weakened after its ruling party chose an ultra-conservative as its leader and likely first woman prime minister.

    Other Asian markets also were mostly higher. U.S. futures climbed and oil gained about $1 a barrel.

    The Liberal Democrats elected Sanae Takaichi, an ally of the late Prime Minister Shinzo Abe, as their leader, likely ensuring she will carry on with his market-friendly policies. Takaichi, 64, admires former British Prime Minister Margaret Thatcher and backed Abe’s ultra-conservative vision for the country.

    She is likely to become prime minister because the LDP has the most seats in the lower house, although not a majority. It chooses the prime minister, and opposition groups are splintered.

    Takaichi faces a host of challenges that have bedeviled her predecessors, BMI of Fitch Solutions said in a commentary. That includes “boosting Japan’s economic competitiveness and strengthening the country’s technological and industrial base and adopting measures to mitigate the impact of Japan’s ageing and declining population amid a colossal public debt burden.”

    Still investors, especially non-Japanese ones, were pleased, said Neil Newman, head of strategy at Astris Advisory Japan.

    “Obviously investors like what she has been saying and certainly today judging by the number of stocks that moved and which stocks moved, it seems like pretty much led by foreigners so far,” Newman said.

    An unconfirmed report that U.S. President Donald Trump might be considering ways to reduce the cost of his higher tariffs on auto parts and other materials for U.S. manufacturers helped automakers’ share prices. Toyota Motor Corp.’s shares jumped 4.9% in Tokyo and Honda Motor Co. gained 4.7%.

    The Nikkei 225 index rose 4.7% to 47,924.52 by mid-afternoon Monday, while Hong Kong’s Hang Seng index sank 0.6% to 26,976.37.

    The yen weakened against the U.S. dollar, on expectations that Takaichi will boost spending, likely adding to inflationary pressures. The dollar rose to 150.31 Japanese yen from 149.33 yen. The euro slipped to $1.1723 from $1.1730.

    In Australia, the S&P/ASX 200 shed 0.1% to 8,976.70.

    Markets in mainland China, Taiwan and South Korea were closed for holidays.

    On Friday, most U.S. stocks ticked higher, adding to Wall Street records.

    The S&P 500 edged up by less than 0.1% to close out its seventh winning week in the last nine, ending at 6,715.79. The Dow Jones Industrial Average climbed 0.5% to 46,758.28. Both added to their all-time highs set the day before.

    The Nasdaq composite lost an early gain and slipped 0.3% from its own record, to 22,780.51.

    Usually, the first Friday of each month has Wall Street transfixed on the monthly jobs update that the U.S. government publishes. It shows how many jobs employers created and destroyed, while also updating the unemployment rate.

    But the shutdown of the U.S. government, now in its third day, delayed the release of that data.

    Such information is particularly important now, given how much on Wall Street is riding on the expectation that the job market is continuing to slow by enough to get the Federal Reserve to keep cutting interest rates.

    Past shutdowns of the U.S. government have tended not to hurt the economy or stock market much, and the thinking is that this one could be similar, even if President Donald Trump has threatened large-scale firings of federal workers this time around.

    Reports came in mixed on activity for U.S. businesses in the health care, real estate and other services industries. One from the Institute for Supply Management said growth is stalling, while another from S&P Global said it’s still growing slowly.

    In other dealings early Monday, U.S. benchmark crude oil gained 99 cents to $61.87 per barrel. Brent crude, the international standard, added 99 cents to $65.52 per barrel.

    A group of countries that are part of the OPEC+ alliance of oil-exporting countries agreed during the weekend to a small boost in oil production, citing a steady global economic outlook. That alleviated fears of an oversupply.

    The group said after a virtual meeting on Sunday that it will raise oil production by 137,000 barrels per day in November, they same amount it announced for October. The group has been raising output slightly in a series of boosts all year, after announcing cuts in 2023 and 2024.

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  • DC’s shutdown hasn’t stopped the stock market. Here’s what may

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    NEW YORK — NEW YORK (AP) — If the U.S. government’s latest shutdown can’t stop the stock market, what can?

    Stock prices keep rising, even as the shutdown delays important economic reports that usually steer trading. The S&P 500 and Dow Jones Industrial Average set all-time highs Friday.

    It’s not just Big Tech driving the market, which has often been the case in recent years. Sure, Nvidia and other darlings of the artificial-intelligence frenzy are still climbing, but almost everything on Wall Street is coming up a winner. The Russell 2000 index of smaller stocks has set a record after taking nearly four years to get back to its prior all-time high. Gold also hit a record in an unusual confluence, while the most popular U.S. bond fund is on track for its best year in at least five.

    Past shutdowns have had minimal effect on the stock market or on the economy, and the bet on Wall Street is that something similar will happen again. Many professional investors expect the market to climb still more, even after a 35% surge from its low in April.

    That’s not to say there aren’t risks. Much of the optimism is built on expectations for certain things to happen. If they don’t, the pretty picture on Wall Street could become much uglier. Among the potential concerns:

    This is the easiest criticism to make about the stock market following its nearly relentless rally since April. Stock prices tend to follow the path of corporate profits over the long term, but stock prices have surged much faster than profits lately.

    One measure popularized by Nobel-winning economist Robert Shiller, which looks at profits over the preceding 10 years, shows the S&P 500 near its most expensive level since the 2000 dot-com bubble. Some critics have made parallels between that bubble, which saw the S&P 500 eventually halve in value, and the recent AI bonanza.

    It’s not just the big household names in the S&P 500 index raising concern. Ann Miletti, head of equity investments for Allspring Global Investments, has been struck by how much stock prices have shot up for speculative kinds of stocks, such as smaller, money-losing companies. They’ve done much better than their profitable counterparts in recent months.

    She said she’s feeling relatively optimistic about conditions for stocks going into 2026, but “it’s these little bubbles that are concerning to me. When you see things like this, it’s generally not a good thing.”

    To be sure, signals suggesting a too-expensive stock market are famously bad at predicting turning points in the market. Stocks can stay expensive for a while, as long as investors stay willing to pay the high prices.

    For stocks to look more typical in valuation, either stock prices need to drop, or corporate profits need to rise. That’s raising stakes for the upcoming profit reporting season.

    Companies are lining up to tell investors how much profit they made during the summer, with PepsiCo and Delta Air Lines scheduled to lead off on Thursday. JPMorgan Chase and other big banks will follow quickly afterward.

    Analysts are looking for S&P 500 companies to report collective growth of 8% in earnings per share from a year earlier, according to FactSet. They’ll need not only to hit that target, but also to forecast continued growth for the rest of this year into next.

    That’s even though companies are still trying to figure out how to deal with tariffs, stubbornly high inflation and other shifts in an uncertain economy.

    One of the main reasons the stock market has boomed is the expectation that the Fed will deliver a string of cuts to interest rates.

    Lower rates give the economy a boost by making it cheaper for U.S. households and companies to borrow and spend. They can also make investors willing to pay higher prices for stocks, bonds and other investments.

    Traders on Wall Street are largely expecting the Fed to cut interest rates at least three more times by the middle of next summer, according to data from CME Group. Fed officials themselves have indicated they’re likely to cut because the job market is slowing.

    But Chair Jerome Powell has insisted they may have to change plans quickly. That’s because inflation has remained stubbornly above the Fed’s 2% target, and lower interest rates can give inflation more fuel.

    “I feel like interest rates and expectations of what the Fed is going to do are driving everything right now,” Miletti said.

    “If the Fed doesn’t cut as much as people are expecting, any of these areas that look a little speculative, because they’re not based on fundamentals, those areas will have some real problems.”

    “This is the question of the decade,” said Yung-Yu Ma, chief investment strategist at PNC Asset Management Group.

    Ma does not feel that AI-related stocks look too expensive, even after their big climbs, but that’s only as long as gangbusters growth and sales for the industry keep going.

    Hopes for AI also seem to be helping to keep down longer-term interest rates and worries about inflation. AI will need to make the economy more productive in order to offset the upward pressure on inflation and interest rates that are coming from the huge mountains of debt that the U.S. and other governments worldwide are building.

    “If we do achieve these benefits for companies and for people’s lives, everything can go well for years,” said Ma. “I think everyone is tying their fortunes to that ship, whether they realize it or not.”

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  • How major US stock indexes fared Friday, 10/3/2025

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    Most U.S. stocks ticked higher, sending Wall Street to more records

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  • Asian shares are mixed as tech shares lead Wall Street ticks to more records

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    MANILA, Philippines — MANILA, Philippines (AP) — Asian shares were mixed on Friday after heavy buying of tech shares led benchmarks on Wall Street to more records.

    US. futures and oil prices were higher.

    Markets have largely shrugged off the shutdown of the U.S. government after Democrat and Republican lawmakers failed to reach agreement on funding.

    U.S. President Donald Trump and congressional leaders were not expected to meet again soon and the Democrats have held fast to their demands to preserve health care funding, warning of price spikes for millions of Americans nationwide.

    Japan’s Nikkei 225 rose nearly 1.7% to 45,691.32 as tech stocks gained despite data showing Japan’s unemployment rate rose 2.6% in August, the highest in 13 months and above the expected 2.4%.

    Shares in Hitachi jumped 9.2% after it signed a memorandum of understanding with OpenAI to provide cooling systems for its data centers.

    Stocks in the computer chip and artificial-intelligence industries also have climbed this week after OpenAI announced partnerships with South Korean companies for Stargate, a $500 billion project aimed at building AI infrastructure.

    Stock exchanges in China and South Korea were closed Friday for holidays.

    Hong Kong’s Hang Seng index shed nearly 0.9% to 27,052.32, as traders sold to lock in profits from Thursday’s gains.

    Australia’s S&P/ASX 200 added more than 0.3% to 8,977.80. India’s BSE Sensex shed 0.2%, while Taiwan’s Taiex rose 1%.

    Thursday on Wall Street, the S&P 500 added 0.1% to its all-time high set the day before, closing at 6,715.35. The Dow Jones Industrial Average rose 0.2% to 46,519.72, and the Nasdaq composite climbed 0.4% to 22,844.05.

    The government shutdown means this week’s usual report on jobless claims was delayed. An even more consequential report, Friday’s monthly tally of jobs created and destroyed across the economy, will likely also not arrive on schedule.

    That increases uncertainty when much on Wall Street is riding on investors’ expectation that the job market is slowing by enough to convince the Federal Reserve to keep cutting interest rates, but not by so much that it leads to a recession.

    So far, the U.S. stock market has looked past the delays of such data. Shutdowns of the U.S. government have tended not to hurt the economy or stock market much, and the thinking is that this one could be similar, even if Trump has threatened large-scale firings of federal workers this time around.

    That left corporate announcements as the main drivers of trading Thursday.

    Excitement around AI and the massive spending underway because of it are a major reason the U.S. stock market has hit record after record, along with hopes for easier interest rates. But AI stocks have become so dominant, and so much money has poured into the industry that worries are rising about a potential bubble that could eventually lead to disappointment for investors.

    Still, Advanced Micro Devices climbed 3.5%, and Broadcom gained 1.4%. Nvidia’s 0.9% rise was the strongest single force pushing the S&P 500 upward.

    In other dealings early Friday, benchmark U.S. crude added 36 cents to $60.84 per barrel. Brent crude, the international standard, rose 36 cents to $64.47 per barrel.

    The U.S. dollar climbed to 147.64 Japanese yen from 147.26 yen. The euro edged up to $1.1725 from $1.1717.

    ___

    AP Writers Stan Choe and Matt Ott contributed.

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  • How major US stock indexes fared Thursday, 10/2/2025

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    U.S. stocks edged up to more records

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  • Buffett’s Berkshire Hathaway to pay $9.7 billion for Occidental Petroleum’s OxyChem

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    OMAHA, Neb. — Berkshire Hathaway is buying Occidental Petroleum’s chemical division for $9.7 billion in what may be the last big acquisition involving the consummate dealmaker, Warren Buffett.

    Buffett wasn’t mentioned anywhere in materials released by Berkshire Hathaway discussing the deal Thursday, potentially signaling a passing of the torch to Vice Chair Greg Abel, to whom Buffet will hand the CEO title in January.

    Buffett will remain chairman at Berkshire and will still be involved in deciding how to spend the conglomerate’s colossal pile of more than $344 billion cash.

    Berkshire’s cash reserves have been growing for years because Buffett has been unable to find any major acquisitions at attractive prices since completing the $11.6 billion acquisition of Alleghany Insurance in 2022. Prices for big acquisitions have been driven higher in recent years by the entry of more hedge funds in the market.

    OxyChem makes things like chlorine for water treatment, vinyl chloride for plastics and calcium chloride that’s used to treat icy roads along with an assortment of other chemicals. It will fit nicely within Berkshire alongside Lubrizol, which Buffett bought in 2011 for $9 billion.

    “Berkshire is acquiring a robust portfolio of operating assets, supported by an accomplished team,” Abel said in a prepared statement. “We look forward to welcoming OxyChem as an operating subsidiary within Berkshire.”

    OxyChem generated $213 million in pretax earnings for Occidental in the second quarter, though that is down from last year when it generated nearly $300 million for the company. This year, Occidental has been selling off some of its assets in the Permian Basin to generate $950 million to pay down debt. Since it completed the CrownRock acquisition in December 2023, Occidental has sold off roughly $4 billion worth of assets to help it pay down $7.5 billion in debt. This OxyChem deal will accelerate that.

    Occidental expects to use $6.5 billion of proceeds from the Berkshire deal to lower debt and achieve the target of principal debt below $15 billion set following the announcement of its CrownRock acquisition.

    Berkshire held more than 28% of Occidental’s stock and had warrants to buy another 83,911,942.38 shares in the major oil and gas producer for $59.586 per share before this deal. And Berkshire held about $8.5 billion worth of preferred Occidental shares that it picked up in 2019 when it helped finance the oil producer’s purchase of Anadarko that Occidental has been paying 8% dividends on every year.

    Buffett had previously told Berkshire investors that he wouldn’t sell off the Occidental stake and he has been periodically buying more shares, but he also told shareholders in 2023 that he had no plans to buy all of Occidental.

    Berkshire owns an eclectic assortment of dozens of companies, including Geico and several other insurers, BNSF railroad, a portfolio of major utilities and some well-known brands like Dairy Queen and See’s Candy. Buffett has built up the conglomerate over the past 60 years. In addition to owning companies outright, Berkshire holds stocks worth more than $250 billion, including large stakes in Apple, Coca-Cola, Bank of America and American Express.

    The OxyChem deal is expected to close in the fourth quarter of this year.

    _____

    AP Business Writer Michelle Chapman contributed to this report.

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  • Asian shares are mixed as traders brace for a possible US government shutdown

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    TOKYO — Asian shares were mixed in narrow trading Tuesday as investors braced for a possible U.S. government shutdown.

    Japan’s benchmark Nikkei 225 declined nearly 0.3% to finish at 44,932.63.

    China reported lackluster data on factory activity for September that reflect persistent weakness in the world’s second largest economy as trade tensions with the U.S. weigh on exports.

    Hong Kong’s Hang Seng gained 0.3% to 26,694.10. The Shanghai Composite index added 0.5% to 3,882.07.

    Elsewhere in Asia, Australia’s S&P/ASX 200 edged down 0.2% to 8,847.00. South Korea’s Kospi slipped nearly 0.1% to 3,428.28.

    The U.S. federal government is nearing a budget deadline that could result in its shutdown.

    Past shutdowns have been shortlived and had minimal impact on markets and the economy. But if the stalemate between Democratic and Republican lawmakers persists, that could delay the collection and release of economic data, such as on jobs and inflation.

    This shutdown may also be different because the White House may push for large-scale firings of federal workers.

    “It feels as though the market has already flogged the government shutdown story from every conceivable angle, the way traders circle a fading theme until there’s nothing left but dust. Yet with the clock ticking down to less than 24 hours before the doors are slated to close in Washington, the narrative refuses to die,” said Stephen Innes. managing partner at SPI Asset Management.

    On Monday, Wall Street finished higher as technology stocks recovered some of their losses from late last week.

    The S&P 500 added 0.3% to 6,661.21 and the Dow Jones Industrial Average edged 0.1% higher, to 46,316.07. The Nasdaq composite climbed 0.5% to 22,591.15.

    Big Tech stocks ticked higher. Amazon added 1.1% following its 5.1% drop last week, and Microsoft rose 0.6% to recover some of its 1.2% decline. They were two of the strongest forces lifting the S&P 500 because they’re two of Wall Street’s most valuable stocks.

    A report is due Friday about how many jobs U.S. employers created and cut last month. The hope is that it will be balanced enough to keep the Federal Reserve on track to continue cutting interest rates.

    The Fed just delivered its first cut of the year, and officials have penciled in more through the end of next year. That’s critical for investors because U.S. stocks have shot to records from a low in April in large part because of expectations for several cuts from the Fed. Easier rates can give the job market a boost and make investors more willing to pay high prices for stocks and other investments.

    If Friday’s job numbers prove too strong, they could make the Fed less willing to cut rates. That could hurt stocks, which already face criticism that they’ve become too expensive following their big rally. If the job numbers are too weak, they could mean a recession that would hurt stock prices on its own.

    Electronic Arts climbed 4.5% after the video game maker confirmed rumors of a $55 billion buyout. A group of investors will pay $210 in cash for each share of EA, and they are calling it history’s largest all-cash deal to take a business private.

    Gold topped $3,850 per ounce to continue its record-breaking run amid expectations for cuts to interest rates by the Fed, along with worries about inflation and the mountains of debt that governments are carrying worldwide.

    In other dealings early Tuesday, benchmark U.S. crude fell 25 cents to $63.20 a barrel. Brent crude, the international standard, lost 39 cents to $67.58 a barrel.

    The U.S. dollar fell to 148.32 Japanese yen from 148.60 yen. The euro cost $1.1733, up from $1.1727.

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  • Asian shares trade mostly higher after Wall Street snaps its 3-day losing streak

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    Shares were mostly higher Monday in Asia after Wall Street broke its three-day losing streak, trimming its losses for last week.

    China factory data are due out on Tuesday and a quarterly business sentiment survey by the Bank of Japan comes on Wednesday.

    The next big event for Wall Street could be a looming shutdown of the U.S. government, with a deadline set for this week. But such political impasses have had limited impact on the market before.

    U.S. jobs data also will be in the spotlight.

    U.S. futures edged higher early Monday and oil prices fell.

    Tokyo’s Nikkei was the regional outlier, giving up 1% to 44,892.52.

    Chinese markets advanced, with the Hang Seng in Hong Kong adding 1.5% to 26,518.03, while the Shanghai Composite index gained 0.1% to 3,832.65.

    Australia’s S&P/ASX 200 rose 0.7% to 8,545.70, while the Kospi in South Korea surged 1.3% to 3,430.57.

    On Friday, U.S. stocks trimmed their losses for the week after a report showed that inflation is behaving roughly as economists expected, even if it’s still high.

    The S&P 500 rose 0.6% to 6,643.70. The Dow Jones Industrial Average gained 0.7% to 46,247.29, while the Nasdaq composite added 0.4% to 22,484.07. All three indexes pulled closer to the all-time highs they set at the start of the week.

    Stocks got some help from the report showing inflation in the United States accelerated to 2.7% last month from 2.6% in July, according to the measure of prices that the Federal Reserve likes to use. While that’s above the Fed’s 2% target, it was precisely what economists had forecast.

    That offered some hope that the Fed could continue cutting interest rates in order to give the economy a boost. Without such cuts, growing criticism that stock prices have become too expensive by rising too quickly would become even more powerful.

    The Fed just delivered its first rate cut of the year last week but is not promising more because they could worsen inflation.

    Another report said sentiment among U.S. consumers was weaker than economists expected. The survey from the University of Michigan said consumers are frustrated with high prices, but their expectations for inflation over the coming 12 months also ticked down to 4.7% from 4.8%.

    One factor threatening to push inflation higher, adding to consumer woes, is President Donald Trump’s tariffs, and he announced more late Thursday. They include taxes on imports of some pharmaceutical drugs, kitchen cabinets and bathroom vanities, upholstered furniture and heavy trucks starting on Oct. 1.

    Details were sparse about the coming tariffs, as is often the case with Trump’s pronouncements on his social media network. That left analysts unsure of their ultimate effects, and the announcement created ripples in the U.S. stock market instead of huge waves.

    Paccar, the company based in Bellevue, Washington, that’s behind the market-dominant Peterbilt and Kenworth truck brands, revved 5.2% higher, for example.

    Big U.S. pharmaceutical companies nudged higher. Eli Lilly rose 1.4%, and Pfizer added 0.7%.

    In other trading early Monday, U.S. benchmark crude oil lost 49 cents to $65.23 per barrel. Brent crude, the international standard, declined 42 cents to $68.80 per barrel.

    Reports that the OPEC plus oil producing nations might raise their production limits next month have added to worries over oversupply, analysts said.

    The U.S. dollar slipped to 148.93 Japanese yen from 149.51 yen. The euro rose to $1.1727 from $1.1703.

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  • How major US stock indexes fared Friday, 9/26/2025

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    Wall Street broke its three-day losing streak and trimmed its losses for the week.

    The S&P 500 rose 0.6% Friday. The Dow Jones Industrial Average climbed 0.7%, and the Nasdaq composite gained 0.4%. All three indexes pulled closer to their records set at the start of the week.

    Stocks got some help from a report on inflation that suggested the Federal Reserve may be able to continue cutting interest rates. Such cuts would help justify high prices for stocks after their big rally. President Donald Trump’s latest tariffs caused waves for some stocks but not for the broad market.

    On Friday:

    The S&P 500 rose 38.98 points, or 0.6%, to 6,643.70.

    The Dow Jones Industrial Average rose 299.97 points, or 0.7%, to 46,247.29.

    The Nasdaq composite rose 99.37 points, or 0.4%, to 22,484.07.

    The Russell 2000 index of smaller companies rose 23.28 points, or 1%, to 2,434.32.

    For the week:

    The S&P 500 is down 20.66 points, or 0.3%.

    The Dow is down 67.98 points, or 0.1%.

    The Nasdaq is down 147.41 points, or 0.7%.

    The Russell 2000 is down 14.45 points, or 0.6%.

    For the year:

    The S&P 500 is up 762.07 points, or 13%.

    The Dow is up 3,703.07 points, or 8.7%.

    The Nasdaq is up 3,173.28 points, or 16.4%.

    The Russell 2000 is up 204.16 points, or 9.2%.

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  • Asian shares tumble after Trump says he will impose new tariffs on drugs and other goods

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    MANILA, Philippines — Asian shares fell on Friday after President Donald Trump announced plans for new tariffs including 100% import taxes on pharmaceutical drugs starting Oct. 1.

    Trump said Thursday on his social media site that foreign makers of furniture and cabinetry were flooding the United States with their products and that tariffs must be applied “for National Security and other reasons.”

    He said foreign-made heavy trucks and parts are hurting domestic producers. However, most such trucks are either made in America or are U.S. brands made in Canada or Mexico.

    U.S. futures slipped while oil prices rose.

    Most Asian indexes were in the red, with Japan’s Nikkei 225 down around 0.3% to 45,629.79.

    Sumitomo Pharma Co.’s shares lost 5.2% while Chugai Pharmaceutical sank 3.9%.

    Government data on Friday showed inflation in the Tokyo area rose 2.5% year-on-year in September, matching the pace in August but falling below expectations of an uptick to 2.8%. Inflation, however, was still above the Bank of Japan’s 2% target, leading to speculation about a rate hike later this year.

    South Korea’s Kospi tumbled 2.5% to 3,384.58 in a third consecutive session of losses amid growing worries over prolonged tariff negotiations with the U.S.

    In Chinese markets, Hong Kong’s Hang Seng index fell 0.7% to 26,313.66 while the Shanghai Composite index was down 0.1% to 3,850.07.

    Australia’s S&P/ASX 200 rose 0.2% to 8,790.20. India’s BSE Sensex fell 0.7% while Taiwan’s Taiex lost 1.5%.

    On Thursday, Wall Street stumbled to a third straight loss as U.S. stocks gave back more of their big gains for the year so far.

    The S&P 500 fell 0.5% to 6,604.72, marking its longest losing streak in more than a month. The Dow Jones Industrial Average dropped 0.4% to 45,947.32, and the Nasdaq composite sank 0.5% to 22,384.70. All three indexes are still near their records set at the start of the week.

    Stocks felt pressure from reports showing the U.S. economy may be stronger than economists thought. While that’s encouraging news for workers and for people looking for jobs, it could make the Federal Reserve less likely to cut interest rates several times in the coming months.

    The Fed just delivered its first cut of the year last week, and officials had penciled in more through the end of next year. That was critical for Wall Street after U.S. stocks shot to records since April in large part because of expectations for rate cuts. Easier rates can boost the economy and make investors more willing to pay high prices for stocks and other investments.

    If the Fed doesn’t cut rates as often as investors expect, it would empower criticism that the U.S. stock market is too expensive after rising so much, so quickly.

    Treasury yields ticked higher in the bond market as traders pared bets for the number of upcoming cuts to rates by the Fed. The yield on the 10-year Treasury rose to 4.17% from 4.16% late Wednesday.

    “For Asia today, it means traders wake up to a market where gravity has reasserted itself. The global $15 trillion rebound year-to-date now feels stretched against yields rising even for all the ‘right’ reasons( stronger growth),” Stephen Innes of SPI Asset Management wrote in a commentary. “It doesn’t take much for enthusiasm to wobble, at lofty peaks, and in this tape, fatigue is dangerous.”

    In other dealings early Friday, benchmark U.S. crude added 30 cents to $65.28 per barrel. Brent crude, the international standard, climbed 25 cents to $69.67 per barrel.

    The U.S. dollar edged down to 149.73 Japanese yen, from 149.75 yen. The euro rose to $1.1676 from $1.667. ___

    AP Business Writer Stan Choe contributed.

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