Sowell’s technical signals remain resolute, keeping portfolios fully invested. And while the Fed’s policy shift suggests the economy may be easing off the throttle, it’s far too soon to declare the start of a true downtrend.
The Fed finally had its big moment, cutting the policy rate by a quarter point to 4.00%–4.25%—a move that was telegraphed but nonetheless historic. The decision was driven by a calibrated view of inflation and a weaker-than-expected labor market, signaling the central bank’s willingness to lean into easing without abandoning its “data dependent” mantra. Markets cheered, with the S&P 500 advancing +1.25% for the week and setting fresh highs, though the celebration was tempered by the fact that investors had already priced in the outcome with near certainty.
Bond markets, however, offered a more cautious outlook. Long-term yields climbed in protest, with the 30-year Treasury rising from 4.68% to 4.75% as investors weighed persistent inflation pressures and ongoing tariff concerns against the Fed’s modest policy shift. Mortgage rates followed suit, reversing a three-year low reached just ahead of the Fed’s action. In effect, the rate cut loosened financial conditions on one end while tightening them on another—an uneasy balance for policymakers.
Beyond the Fed, politics and trade returned to the spotlight. The White House announced that a framework for a U.S.-China trade deal is within reach, including long-disputed ownership and commercial terms for TikTok’s U.S. operations. President Trump extended the reciprocal tariff deadline to November 10th, buying time but leaving uncertainty alive in markets. For equities, this was enough to keep sentiment buoyant, even if bonds remained skeptical.
Meanwhile, corporate drama unfolded in the semiconductor industry. Intel, long viewed as a laggard, became the surprise star of the week. Following President Trump’s deal to take a 10% stake, Nvidia announced it would invest $5 billion to co-develop chips for data centers and PCs with Intel. The news ignited Intel’s stock, surging more than 30% intraday and closing the week up a stunning +22.8%. The episode underscored both the political spotlight on U.S. tech and the enormous investor appetite for AI and chip-related investments.
Last week's economic data highlighted a surprising and multifaceted picture of the U.S. economy, displaying the enduring strength of the consumer and early signs of industrial resilience. These figures provide an interesting lens through which to view the impact of ongoing policy shifts, including President Trump's "America First" agenda.
Key Economic Indicators:
Consumer Spending Remains Robust: Retail sales for August increased by a strong 0.6% from the prior month, significantly exceeding the consensus forecast of a 0.2% gain. This positive surprise suggests that, despite inflationary pressures, consumers are continuing to spend, which remains a key driver of economic growth.
Industrial Sector Holds Steady: The industrial sector demonstrated stability, with some key metrics even surpassing expectations to the upside.
Industrial Production: Contrary to expectations of a decline, industrial production posted a surprise positive gain of 0.1%, surpassing the consensus estimate of a 0.1% decline. This suggests that factories are maintaining or even slightly increasing their output.
Manufacturing Production: A notable positive was the 0.2% increase in manufacturing production, which exceeded the consensus estimate of a 0.2% decline. This gain suggests a potential revival in domestic manufacturing activity, which aligns with the goals of the "America First" policies aimed at boosting domestic production.
Factories' Capacity Utilization: The capacity utilization rate remained steady at 77.4%.
Labor Market Strength: The labor market continued to show strength as initial jobless claims declined by 33,000 to a new low of 231,000. This represents a significant decline from the previous week's 264,000 claims, indicating a tight labor market with fewer layoffs.
Mixed Signals from Leading Indicators: While many data points were positive, the Conference Board's Leading Economic Index (LEI) for August dipped by 0.5%, a larger decline than street estimates. The decline in the LEI suggests that, while current economic conditions are strong, potential headwinds may be on the horizon that could slow growth in the coming months.
Taken together, the week showcased the push and pull that now define markets: equities leaning on policy easing, trade optimism, and tech’s resurgence; bonds reflecting fiscal strain, inflation stickiness, and rising term premiums. The risks ahead are clear—tariffs still unresolved, inflation not yet conquered, and valuations barbelled—but for now, the market seems content to walk the tightrope with the Fed’s first cut as a balancing pole.
As we look ahead, the coming week's economic calendar focuses squarely on the heart and soul of our economy: weekly jobs, followed by a look at the gears of commerce with wholesale inventories, and finally, a deep dive into the engine of growth—GDP, personal income, and spending. However, we can’t ignore the clouds gathering in Washington. The U.S. Senate has, unfortunately, rejected the stopgap funding bill. With Congress now in recess, it appears the only thing taking a vacation is common sense. This leaves a looming threat of a government shutdown by September 30—a self-inflicted wound that would do nothing but create unnecessary turbulence.
"I think you could think of this in a way as a risk-management cut because, if you look at the SEP, actually the projections for growth this year and next actually ticked up just a little bit and inflation and unemployment didn't really move. So what's different now? What's different now is you see a very different picture of the risks to the labor market.”
– Chair Powell’s FOMC Press Conference, September 17, 2025
Oracle: Back… to the Future!
Op-Ed By Gregory Lai
“Roads? Where we’re going, we don’t need roads.” — Doc Brown
When I started at PIMCO in 1989, one of the very first sell-side analyst meetings I attended was on Oracle. At the time, Oracle was everywhere — a default tech holding in every portfolio. I recall the analyst proudly recounting how he had followed the company since its early days in a 900-square-foot Santa Clara office — barely larger than a garage, yet already legendary. That was the badge of honor: you had spotted the future early.
Over the decades, though, Oracle came to feel less like a growth rocket and more like an old DeLorean parked in the garage: iconic but gathering dust.
Now the doors have flown open, the flux capacitor has been reinstalled, and Larry Ellison has strapped himself in as our industry’s very own Doc Brown.
Act I — 1985: The Beginning
In the first tech revolution, Oracle was indispensable. Its relational databases powered banks, retailers, governments — the hidden infrastructure of the digital age. Larry Ellison was brash, brilliant, a showman tinkering with code the way Doc Brown tinkered with the flux capacitor. If Microsoft and Apple were consumer-facing stars, Oracle was the wiring behind the wall. You couldn’t build without it.
Act II — Stuck in Time
Throughout the 2000s and 2010s, Oracle looked stranded in another era. The world has moved to the cloud; Amazon, Microsoft, and Google have become the new titans. Oracle was still there, still profitable, but it had become ballast in portfolios — owned more out of inertia than conviction. Ellison was better known for owning an island, funding movies, or hanging with tennis pros. The DeLorean was still on the street, but no one believed it could hit 88 miles per hour again.
Cisco Systems, anyone?
Act III — Lightning Strikes the Clock Tower
Enter the AI era — Oracle’s clock tower moment.
Last week they announced…the future:
Cloud Infrastructure (OCI): Forecast to grow 77% this year to $18B, with a four-year trajectory to $144B.
Future revenue booked: Remaining performance obligations surged 359% to $455B, giving Oracle its clearest runway in history.
Multicloud strategy: By delivering OCI through Amazon, Google, and Microsoft, Oracle has turned rivals into distribution partners — Doc Brown’s universal adapter for the future of compute.
AI partnerships: OpenAI’s $30B-a-year compute power lease, plus deals with NVIDIA, xAI, and Meta. The flux capacitor has been upgraded.
Act IV — The New Timeline
The result? Oracle just staged its biggest daily rally in decades, up 36%, adding $244B in market cap, edging toward the trillion-dollar club in a single session — a move straight out of 1992. Marty McFly is back, not just from the future, but as the future.
Oracle now stands alongside Apple, Microsoft, and even Nvidia — companies once dismissed or niche, now writing the script for the next era of technology. (Nvidia was the most interesting as it was a niche player in graphics cards.)
Ellison as Doc Brown
Larry Ellison has always been a character — part visionary, part provocateur. But like Doc Brown, his eccentricity concealed a design ahead of its time. Oracle is no longer just the database of record. It is becoming the compute layer of the AI economy — the wiring for intelligence itself.
Back then, it was plumbing for information. Today, it’s infrastructure for imagination.
The DeLorean is back on the road, and with Ellison at the wheel, Oracle is once again blasting past 88 miles per hour — straight into the future.
Disclosure: This material is for informational purposes only and should not be considered investment advice. The opinions contained herein are subject to change without notice.
Advisory services offered through Sowell Management, a Registered Investment Advisor. The views expressed represent the opinion of Sowell Management. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and non-proprietary sources that have not been independently verified for accuracy or completeness. While Sowell Management believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sowell Management’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.
You should receive a confirmation email shortly. Don’t forget to reserve your room through the unique Sowell hotel reservation page. You can extend your stay at the Sowell Summit reduced room rate.
WEEK AHEAD
September 22-26, 2025
The Fed finally had its big moment, cutting the policy rate by a quarter point to 4.00%–4.25%—a move that was telegraphed but nonetheless historic. The decision was driven by a calibrated view of inflation and a weaker-than-expected labor market, signaling the central bank’s willingness to lean into easing without abandoning its “data dependent” mantra. Markets cheered, with the S&P 500 advancing +1.25% for the week and setting fresh highs, though the celebration was tempered by the fact that investors had already priced in the outcome with near certainty.
Bond markets, however, offered a more cautious outlook. Long-term yields climbed in protest, with the 30-year Treasury rising from 4.68% to 4.75% as investors weighed persistent inflation pressures and ongoing tariff concerns against the Fed’s modest policy shift. Mortgage rates followed suit, reversing a three-year low reached just ahead of the Fed’s action. In effect, the rate cut loosened financial conditions on one end while tightening them on another—an uneasy balance for policymakers.
Beyond the Fed, politics and trade returned to the spotlight. The White House announced that a framework for a U.S.-China trade deal is within reach, including long-disputed ownership and commercial terms for TikTok’s U.S. operations. President Trump extended the reciprocal tariff deadline to November 10th, buying time but leaving uncertainty alive in markets. For equities, this was enough to keep sentiment buoyant, even if bonds remained skeptical.
Meanwhile, corporate drama unfolded in the semiconductor industry. Intel, long viewed as a laggard, became the surprise star of the week. Following President Trump’s deal to take a 10% stake, Nvidia announced it would invest $5 billion to co-develop chips for data centers and PCs with Intel. The news ignited Intel’s stock, surging more than 30% intraday and closing the week up a stunning +22.8%. The episode underscored both the political spotlight on U.S. tech and the enormous investor appetite for AI and chip-related investments.
Last week's economic data highlighted a surprising and multifaceted picture of the U.S. economy, displaying the enduring strength of the consumer and early signs of industrial resilience. These figures provide an interesting lens through which to view the impact of ongoing policy shifts, including President Trump's "America First" agenda.
Key Economic Indicators:
Taken together, the week showcased the push and pull that now define markets: equities leaning on policy easing, trade optimism, and tech’s resurgence; bonds reflecting fiscal strain, inflation stickiness, and rising term premiums. The risks ahead are clear—tariffs still unresolved, inflation not yet conquered, and valuations barbelled—but for now, the market seems content to walk the tightrope with the Fed’s first cut as a balancing pole.
As we look ahead, the coming week's economic calendar focuses squarely on the heart and soul of our economy: weekly jobs, followed by a look at the gears of commerce with wholesale inventories, and finally, a deep dive into the engine of growth—GDP, personal income, and spending. However, we can’t ignore the clouds gathering in Washington. The U.S. Senate has, unfortunately, rejected the stopgap funding bill. With Congress now in recess, it appears the only thing taking a vacation is common sense. This leaves a looming threat of a government shutdown by September 30—a self-inflicted wound that would do nothing but create unnecessary turbulence.
Oracle: Back… to the Future!
Op-Ed
By Gregory Lai
“Roads? Where we’re going, we don’t need roads.” — Doc Brown
Act I — 1985: The Beginning
Act II — Stuck in Time
Act III — Lightning Strikes the Clock Tower
Act IV — The New Timeline
Ellison as Doc Brown
Larry Ellison has always been a character — part visionary, part provocateur. But like Doc Brown, his eccentricity concealed a design ahead of its time. Oracle is no longer just the database of record. It is becoming the compute layer of the AI economy — the wiring for intelligence itself.
Back then, it was plumbing for information. Today, it’s infrastructure for imagination.
The DeLorean is back on the road, and with Ellison at the wheel, Oracle is once again blasting past 88 miles per hour — straight into the future.
Advisory services offered through Sowell Management, a Registered Investment Advisor. The views expressed represent the opinion of Sowell Management. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and non-proprietary sources that have not been independently verified for accuracy or completeness. While Sowell Management believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sowell Management’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.