Market Trends & Dynamics - Major indices initially showed upward momentum but faced downward pressure from NASDAQ, with the Dow up approximately 04% [3] - S&P 500 is up over 2% this month, defying typical weaker September trends [4][10] - New tariffs on imported goods, including 100% on some drugs, 50% on kitchen cabinets, 30% on upholstered furniture, and 25% on big trucks, are set to take effect [11] - The market is closely watching whether long-run earnings per share can meet embedded expectations, differentiating current momentum from past bubbles [18] Company Performance & Analysis - Costco stock trended lower, down nearly 4% at the open, despite prior optimism, and JP Morgan cut its price target to $150 from $1,160 [5][6] - Costco's year-to-date performance has struggled, down more than 1%, contrasting with Walmart's over 10% increase [7] - Bettercom shares surged nearly 75% in a week, driven by retail investor interest, with the company projecting profitability by Q3 2026 [33][34] - Bettercom aims to achieve 10% market share in a revitalized housing market, leveraging AI to offer lower prices and faster closing times [40][41] Sector Analysis & Opportunities - Healthcare sector (XLV) has underperformed, up only 2% over the last two years compared to technology and communication services, which are up over 66% [25][26] - Small-cap energy sector shows potential for growth, with Invesco S&P Small Cap 600 Energy Sector ETF (PSCE) displaying improving price and power ratings [29] Economic Factors & Fed Policy - PCE inflation rose slightly to 27% year-over-year in August, compared to 26% in July, potentially keeping the door open for another rate cut in October [10] - Cooler-than-expected PCE numbers have increased the likelihood of October and December rate cuts [31] - Potential Fed rate cuts could significantly increase the number of consumers eligible for refinancing, potentially boosting Bettercom's revenue [42][43]

Market Trends & Consumer Behavior - US consumers have shown extraordinary resilience this year [1] - 50% of US consumers are in the top 10% of income earners, contributing to sustained consumer spending [2] - $10 trillion is currently held in money market cash [3] Investment Strategies & Sector Focus - The market is looking for certainty from Washington, particularly regarding tariffs, to encourage investment [4] - Large-cap financials are favored in low interest rate environments [5] - Banks are considered a good investment, also as a tech play due to AI adoption [6] - Communication services are attractive due to their lower tariff sensitivity [7] - Utilities, especially nuclear companies servicing data and AI expansion, are being considered [7] Semiconductor Industry - SMH, the semiconductor sector, is up 32% year-to-date, with strong demand and outperforming companies [8]

Investment Rating - The report indicates a revised Q1 GDP growth of -0.2% (quarter-over-quarter annualized), which is an upward revision of 0.1 percentage points from previous estimates [1][6] Core Insights - The revision details show softer underlying growth, particularly in real domestic final sales, which were revised down by 0.3 percentage points, primarily due to a 0.6 percentage point downward revision in consumer spending growth [1][6] - The contribution of inventory accumulation to GDP growth was revised up by 0.3 percentage points to 2.6 percentage points, while net exports' contribution was revised down by 0.1 percentage points to -4.9 percentage points [6][7] - Real gross domestic income (GDI) fell by 0.2% in Q1, influenced by a significant drag from net dividends, which saw a $125 billion increase from the rest of the world, the largest since 2018 [7][8] - Core PCE inflation for April is forecasted at 0.10%, leading to a year-over-year rate of 2.49%, while headline PCE inflation is expected at 0.09%, corresponding to a year-over-year rate of 2.12% [8][9] - Initial jobless claims rose to 240,000 for the week ending May 24, exceeding expectations, with continuing claims also showing an increase [9][10] Summary by Sections GDP and Economic Activity - Q1 GDP growth was revised to -0.2%, with consumer spending growth revised down to +1.2% [2][6] - Equipment investment growth saw a significant upward revision to +24.8% [6][7] Inflation Metrics - Core PCE inflation was revised down to +3.41% annualized, with the year-on-year rate at +2.76% [8] - The GDP deflator was also revised down to +3.70% annualized [8] Employment Data - Initial jobless claims increased by 14,000 to 240,000, with a four-week moving average remaining at 231,000 [9][10]