AE Wealth Management: Weekly Market Insights | 11/2/25 – 11/8/25
Weekly Market Commentary
THE WEEK IN REVIEW: Nov. 2-8, 2025
The U.S. government remained closed
There was some expectation that the government would reopen after last Tuesday’s elections, but nobody seemed to be in a conciliatory mood after the Democrats “swept” the results.1 The Democrats offered to reopen the government on Friday if Affordable Care Act (ACA) subsidies were extended for another year.2 They also wanted to create a bipartisan commission to negotiate a longer-term solution for the subsidies and other health care reforms, beginning its work after the government reopens. Republicans said no.
Some are portraying the elections as a stunning rebuke for Republicans. Democrats won where they were expected to win, and if they lost the governorship in New Jersey or failed to win in Virginia (with its thousands upon thousands of furloughed government workers), they would have been forced to fold and reopen the government. But that didn’t happen — and they feel they’re on the right side of this debate.
The problem is that no one is on the right side. Both parties are to blame; subsidies for the ACA aren’t affordable (thanks, Democrats), and we can’t afford to pay them (thanks, Republicans). So the government remained shut, air travel was throttled as the system has become overburdened, and delays stacked up because air traffic controllers and TSA workers are expected to show up and work without pay.3 Financial assistance to those in need has slowed to a trickle, the optics are abysmal and people are fed up.4
From a market perspective, the shutdown continues to cloud the state of the economy. We haven’t been getting data for the markets to react to, and when the government reopens, there will be a flood of data that could result in some larger-scale volatility. A good earnings season is being ignored because markets have been focused on the shutdown. The good news is that there appears to be some movement, and if things line up, the government may be reopened by the end of the week. We should begin getting economic data then.5
Markets get hammered as AI stocks lose steam and consumer confidence falters
Markets took it on the chin last week as artificial intelligence (AI) trade faltered and good earnings weren’t enough to offset the jitters.6 In this case, it was a combination of not-so-extraordinary things. First, markets were still feeling anxious after Federal Reserve Chair Jerome Powell created doubt about getting another rate cut this year. Second, the government shutdown continued to drag on, and we haven’t been receiving economic data.
The doom and gloom is getting to the consumer. And the media isn’t helping but is instead amplifying the foul mood. All the negativity is weighing on the consumer, and it was reflected in one of the lowest consumer confidence readings in history last week.7 It may be too late for the economy if people decide they’ve had enough and stop spending. With the consumer making up nearly 70% of our economy, that scenario could lead to a dire situation.8
Coming this week
- The lack of data could impact the Fed at its final meeting in early December, but the odds of a cut are beginning to decline. As of last week, the probability of a cut was running at 66.9%.9
- Third-quarter earnings are almost finished, with 91% of S&P 500 companies reporting results.10 The results have been solid: 82% of companies have reported positive earnings per share (EPS) and 77% reported positive revenue. Earnings growth for the third quarter is 13.1%, up from last quarter and just below Q1. For the current quarter, 42 S&P 500 companies have issued negative EPS guidance and 31 have issued positive EPS guidance.
- The bond market will be closed on Tuesday for Veterans Day, while the stock market will be open.
- Data this week will be scant. We’ll see MBA mortgage applications on Wednesday and weekly unemployment claims on Thursday.
- Now that the government is reopening, we should see the latest consumer price index (CPI) and producer price index (PPI) readings on Thursday and Friday, respectively. Neither numbers were reported last month due to the shutdown. These numbers will play heavily into the Fed’s December rate decision.
Index Performance Returns % | |||||
| 1 WK | YTD | 1YR | 3YRS | 5YRS | |
| S&P 500 | -1.63% | 14.40% | 12.65% | 20.91% | 13.90% |
| NASDAQ | -3.04% | 19.13% | 19.38% | 29.61% | 14.01% |
| DJIA | -1.21% | 10.44% | 7.45% | 12.07% | 10.65% |
Interest Rates: | |||||
| 11/7/2025 | 10/31/2025 | ||||
| UST 10 YR Government Bond Yield | 4.09% | 4.08% | |||
| Germany 10 YR | 2.67% | 2.63% | |||
| Japan 10 YR | 1.68% | 1.67% | |||
| 30 YR Mortgage | 6.17% | 6.17% | |||
| Oil | $59.75/ppb | $60.98/ppb | |||
| Regular Gas | $3.07/ppg | $3.04/ppg | |||
| All data as of Nov. 7, 2025 | |||||
Sources:
1 Caitlin Yilek and Joe Walsh. CBS News. Nov. 5, 2025. “Democrats sweep key races in 2025 elections in early referendum on Trump.” https://www.cbsnews.com/live-updates/election-day-2025-voting-results/. Accessed Nov. 8, 2025.
2 Jordain Carney. Politico. Nov. 7, 2025. “Senate Democrats propose 1-year Obamacare subsidies punt in new shutdown offer.” https://www.politico.com/live-updates/2025/11/07/congress/obamacare-punt-democrats-shutdown-00642467. Accessed Nov. 8, 2025.
3 Chris Morris. Yahoo! News. Nov. 7, 2025. “Flight cancellations stack up as FAA throttling begins.” https://www.yahoo.com/news/articles/flight-cancellations-stack-flight-throttling-144141991.html. Accessed Nov. 8, 2025.
4 Aria Bendix, et al. NBC News. Nov. 7, 2025. “Supreme Court allows Trump administration to temporarily withhold some SNAP payments for November.” https://www.nbcnews.com/politics/politics-news/trump-administration-asks-emergency-pause-judges-order-fully-fund-snap-rcna242545. Accessed Nov. 8, 2025.
5 Jordain Carney. Politico. Nov. 9, 2025. “Senate advances plan to end historic shutdown in bipartisan breakthrough.” https://www.politico.com/news/2025/11/09/government-funding-deal-on-track-to-advance-sunday-night-00644110. Accessed Nov. 10, 2025.
6 Steve Kopack. NBC News. Nov. 7, 2025. “AI stocks lost more than $820 billion this week.” https://www.nbcnews.com/business/markets/stock-market-update-ai-losses-rcna242592. Accessed Nov. 8, 2025.
7 Jeff Cox. CNBC. Nov. 7, 2025. “Consumer sentiment nears lowest level ever as worries build over shutdown.” https://www.cnbc.com/2025/11/07/consumer-sentiment-shutdown.html. Accessed Nov. 8, 2025.
8 Jeffry Bartash. Morningstar. Sept. 25, 2025. “‘Thanks to the mighty consumer,’ GDP shows more spring in U.S. economic growth.” https://www.morningstar.com/news/marketwatch/20250925209/thanks-to-the-mighty-consumer-gdp-shows-more-spring-in-us-economic-growth. Accessed Nov. 8, 2025.
9 CME Group. “FedWatch.” https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html. Accessed Nov. 8, 2025.
10 John Butters. FactSet. Nov. 7, 2025. “Earnings Insight.” https://advantage.factset.com/hubfs/Website/Resources
%20Section/Research%20Desk/Earnings%20Insight/EarningsInsight_110725B.pdf. Accessed Nov. 8, 2025.
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