The spread for the US 10-year Treasury yield over a “fair value” estimate has narrowed to the smallest gap in a year, based on the average estimate for three models run by CapitalSpectator.com.
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Macro Briefing: 17 October 2025
US stocks fell on Thursday amid growing concerns about regional bank loans. “Credit quality worries are plaguing Wall Street today as fears mount that there are multiple large lenders with heavy exposure to problematic loans with limited collateral,” said José Torres, senior economist at Interactive Brokers. An ETF targeting regional bank stocks (KRE) dropped 6.2% yesterday, closing at the lowest level since August.
High-Beta Stocks Take The Lead For Equity Risk Factors In 2025
A handful of equity risk factors are outperforming the broad stock market this year, and within the elite winner’s circle so-called high-beta shares are leading the field, based on a set of ETFs through Wednesday’s close (Oct. 15).
Macro Briefing: 16 October 2025
US to take control of more companies as counter to China’s dominance in rare earth supplies, which are critical for a range of industries. “When you are facing a nonmarket economy like China, then you have to exercise industrial policy,” Treasury Secretary Bessent said. “So we’re going to set price floors and the forward buying to make sure that this doesn’t happen again and we’re going to do it across a range of industries.” An ETF targeting companies in the rare earth industry fell on Wednesday after trading at a record high the previous day.
Bond Market Continues To Downplay Inflation Risk
If higher tariff-related inflation is a risk, it’s not showing up in the bond market, at least not yet. Yields remain near the lowest levels of the year, suggesting that fixed-income investors aren’t convinced that pricing pressure is a bigger threat vs. slowing economic growth.
Macro Briefing: 15 October 2025
US small business sentiment in September weakened for the first time in three months, according to NFIB. “While most owners evaluate their own business as currently healthy, they are having to manage rising inflationary pressures, slower sales expectations, and ongoing labor market challenges,” said the group’s chief economist.
Geopolitical Risk Sends Rare Earth Stocks Soaring
Geopolitics has been a key risk factor in economic and financial trends this year, including companies engaged in mining and processing of rare earth elements. As tensions rise between the US and China on access to these critical commodities, creating fears of supply chain shocks, stocks in the industry are roaring higher, based on a set of ETFs through Monday’s’ close (Oct. 13).
Macro Briefing: 14 October 2025
Treasury Secretary Scott Bessent said Monday the government shutdown is starting to affect the U.S. economy. “It’s starting to affect the real economy. It’s starting to affect people’s lives,” he said in a TV interview. The latest update of the Dallas Fed’s Weekly Economic Index continues to reflect moderate growth: “The WEI is currently 2.42 percent, scaled to four-quarter GDP growth, for the week ended Oct. 4 and 2.37 percent for Sept. 27.”
Financial Markets Are Sensitive To Risk After All
It was starting to look like market sentiment was immune to the news flow. But all it took was one social media comment by President Trump on Friday to remind the crowd that risk and uncertainty were still lurking below the surface, waiting for someone or something to revive fear and panic.
Macro Briefing: 13 October 2025
The US breakeven employment level — the number of jobs required each month to keep the labor market in balance — has declined after immigration changes, estimates a researcher at the Dallas Fed: “A new, high-frequency estimate of break-even employment shows a dramatic reversal in immigration flows, combined with cyclical shifts in labor force participation, has caused the monthly break-even requirement to collapse from a peak of approximately 250,000 in 2023 to about 30,000 in mid-2025.”
