Finding Clarity (and a Bit of Calm) Amid the Noise
As we turn the corner into the final stretch of 2025, the mood across markets feels… surprisingly good. After a year full of headlines about data revisions, tariffs, and policy pivots, investors are ending the year with something rare: cautious optimism.
The Federal Reserve’s September rate cut, its first since 2024, marked a meaningful shift from asking “how high will rates go?” to “how much support can we get?” A second cut in October confirmed that shift. Inflation continues to ease, now near 2.8%. Job growth is slowing but steady, and consumers are still opening their wallets. For a late cycle economy, that is not bad at all.
At Stevens Capital Partners, we see this as an encouraging setup for 2026. In our view, growth can continue, but with fewer surprises and, hopefully, a little less drama.
The Market That Just Won’t Quit
Despite every reason to take a breather, markets have pressed higher. The S&P 500 has notched four straight months of gains, emerging markets are up more than 7%, and bonds have rallied as yields drifted lower. Even the recent government shutdown (yes, that again) barely caused a ripple.
The labor market data may have looked scary. Nearly one million jobs were revised out of prior reports, but it turns out that was more about spreadsheets than conspiracies. Survey participation fell, delayed responses piled up, and once the data caught up, things looked… normal.
Meanwhile, consumers continue to carry the economy forward. The top 10% of earners now account for about half of all U.S. spending. That’s a level of concentration worth watching, but for now it’s fueling the “wealth effect” as rising portfolios boost confidence and shopping.
Innovation Keeps the Engine Running
Corporate earnings have held up remarkably well. More than 80% of companies beat expectations in the third quarter, powered by solid margins and another wave of tech investment. AI spending is the new corporate arms race; global outlays on AI infrastructure are expected to top $2 trillion by 2026.
If the 1980s had personal computers and the 1990s had the internet, this era’s defining driver is artificial intelligence. It’s not just changing how companies work; it’s changing where the growth story lives. We see AI as a long-term catalyst that’s still in its early innings.
Around the World: Trade Talks and Turnarounds
Globally, there’s a bit of good news for a change. The U.S. and China dialed down trade tensions with a one-year deal on tariffs and rare earth exports. Japan’s election of its first female prime minister brought optimism to Tokyo markets, while Europe and the U.K. benefited from easing inflation and lower bond yields.
Emerging market debt also had a strong month, boosted by higher real yields and a weaker dollar. Overall, global sentiment improved, and investors noticed.
Looking Ahead: Opportunity with a Side of Perspective
We’re the first to admit that much of the good news is already reflected in prices. Equity valuations are elevated, AI enthusiasm is running high, and any policy misstep could cause turbulence. Even so, when we step back, the broader picture looks constructive: inflation is cooling, earnings are growing, consumers are spending, and innovation is driving productivity.
At Stevens Capital Partners, we’re leaning into that optimism, thoughtfully. We continue to emphasize:
- Diversification, because concentration looks great until it doesn’t.
- Balance, as fixed income regains its role as a stabilizer.
- Perspective, because short-term noise rarely changes long-term goals.
The market may wobble between excitement and anxiety, but that’s nothing new. We’d rather stay invested, stay informed, and, as always, stay focused on what really matters: your long-term success.
As Thanksgiving approaches, we’re reminded of the importance of gratitude in life and in investing. We’re deeply thankful for your continued trust, partnership, and confidence in us. Here’s to a season filled with good company, good food, and continued opportunities ahead.
WRITTEN BY:
David Stevens
Government Pause Market Poise
Finding Clarity (and a Bit of Calm) Amid the Noise
As we turn the corner into the final stretch of 2025, the mood across markets feels… surprisingly good. After a year full of headlines about data revisions, tariffs, and policy pivots, investors are ending the year with something rare: cautious optimism.
The Federal Reserve’s September rate cut, its first since 2024, marked a meaningful shift from asking “how high will rates go?” to “how much support can we get?” A second cut in October confirmed that shift. Inflation continues to ease, now near 2.8%. Job growth is slowing but steady, and consumers are still opening their wallets. For a late cycle economy, that is not bad at all.
At Stevens Capital Partners, we see this as an encouraging setup for 2026. In our view, growth can continue, but with fewer surprises and, hopefully, a little less drama.
The Market That Just Won’t Quit
Despite every reason to take a breather, markets have pressed higher. The S&P 500 has notched four straight months of gains, emerging markets are up more than 7%, and bonds have rallied as yields drifted lower. Even the recent government shutdown (yes, that again) barely caused a ripple.
The labor market data may have looked scary. Nearly one million jobs were revised out of prior reports, but it turns out that was more about spreadsheets than conspiracies. Survey participation fell, delayed responses piled up, and once the data caught up, things looked… normal.
Meanwhile, consumers continue to carry the economy forward. The top 10% of earners now account for about half of all U.S. spending. That’s a level of concentration worth watching, but for now it’s fueling the “wealth effect” as rising portfolios boost confidence and shopping.
Innovation Keeps the Engine Running
Corporate earnings have held up remarkably well. More than 80% of companies beat expectations in the third quarter, powered by solid margins and another wave of tech investment. AI spending is the new corporate arms race; global outlays on AI infrastructure are expected to top $2 trillion by 2026.
If the 1980s had personal computers and the 1990s had the internet, this era’s defining driver is artificial intelligence. It’s not just changing how companies work; it’s changing where the growth story lives. We see AI as a long-term catalyst that’s still in its early innings.
Around the World: Trade Talks and Turnarounds
Globally, there’s a bit of good news for a change. The U.S. and China dialed down trade tensions with a one-year deal on tariffs and rare earth exports. Japan’s election of its first female prime minister brought optimism to Tokyo markets, while Europe and the U.K. benefited from easing inflation and lower bond yields.
Emerging market debt also had a strong month, boosted by higher real yields and a weaker dollar. Overall, global sentiment improved, and investors noticed.
Looking Ahead: Opportunity with a Side of Perspective
We’re the first to admit that much of the good news is already reflected in prices. Equity valuations are elevated, AI enthusiasm is running high, and any policy misstep could cause turbulence. Even so, when we step back, the broader picture looks constructive: inflation is cooling, earnings are growing, consumers are spending, and innovation is driving productivity.
At Stevens Capital Partners, we’re leaning into that optimism, thoughtfully. We continue to emphasize:
The market may wobble between excitement and anxiety, but that’s nothing new. We’d rather stay invested, stay informed, and, as always, stay focused on what really matters: your long-term success.
As Thanksgiving approaches, we’re reminded of the importance of gratitude in life and in investing. We’re deeply thankful for your continued trust, partnership, and confidence in us. Here’s to a season filled with good company, good food, and continued opportunities ahead.
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The views contained herein are not to be taken as advice or recommendation to buy or sell any investment in any jurisdiction. Any forecasts, figures, opinions or investment techniques and strategies set out are for information purposes only, based on certain assumptions and current market conditions, and are subject to change without prior notice. All information presented herein is considered to be accurate at the time of the output, but no warranty of accuracy is given and no liability in respect of any error or omission is accepted. It should be noted that the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Both past performance and yield may not be a reliable guide to future performance.
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