US stocks close higher as government shutdown looms, plus the winners & losers of Q3 2025

Market Overview - The major U.S. stock indices finished higher, with the Dow up approximately 90 points, the S&P 500 increasing by about 0.4%, and the NASDAQ gaining around 0.3% [1] - September ended positively, marking a solid conclusion to Q3, despite concerns over a potential U.S. government shutdown [2][3] Economic Context - Analysts suggest that the likelihood of a government shutdown is high, which could impact the release of key economic data, including jobs reports [2][10] - Despite these risks, the market appears to be focusing on growth and productivity, seemingly ignoring potential negative impacts from a shutdown [10] Earnings and Corporate Performance - Expectations for corporate earnings growth are optimistic, with projections of 7% to 10% growth for the year, driven by productivity and favorable pricing conditions [13][16] - Companies are investing heavily in capital expenditures (capex), which may lead to lower returns of capital to investors in the near term [16][17] Sector Performance - The technology sector and communication services outperformed, with notable performances from companies like Alphabet and Tesla, which saw increases of 14.2% and 33.2% respectively in September [20][24] - The S&P 500, NASDAQ Composite, and NASDAQ 100 experienced their best September since 2010 and the best Q3 since 2020 [21] Nike's Financial Results - Nike reported revenue of $11.72 billion, exceeding Wall Street's expectations of $11.02 billion, marking a 1% increase year-over-year [32] - The company faced challenges with higher inventory levels and a gross margin decrease of 320 basis points to 42.2%, attributed to lower average selling prices and increased tariffs [35][36] - Nike's wholesale revenue increased by approximately 7%, while direct-to-consumer sales declined by about 4% to 4.5 billion [33] Competitive Landscape - The sportswear market has become increasingly competitive, with Nike losing some market share to newer brands and established competitors like Adidas and New Balance [46] - Analysts believe that Nike's strong brand presence and upcoming major sporting events, such as the Olympics and the World Cup, could provide significant promotional opportunities [41][42] Valuation Insights - Analysts consider Nike to be undervalued, with a fair value estimate of $104 per share, suggesting potential for growth as the company navigates its turnaround strategy [48][49]