Wall Street Breakfast What weak economy?
Sep 25, 2025
Strong economic reports are reshaping expectations at the Fed, leaving analysts questioning the prevailing narrative of a weak economy. CarMax faces significant challenges with disappointing earnings and sales figures, prompting market reevaluation. Oracle encounters skepticism as a notable firm downgrades its cloud revenue prospects amidst rising competition. Additionally, the S&P 500 is seen by some as a new benchmark for risk-free investing, challenging traditional investment perceptions.
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Data Rewrites Fed Expectations
- Multiple strong data points (jobless claims, durable goods, GDP revision) signaled a hotter-than-expected economy this morning.
- Fed cut expectations fell and Treasury yields and the dollar rose in response.
Q2 Growth And Inflation Surprise
- Q2 GDP was revised up to a 3.8% annualized pace, stronger than prior estimates.
- Core PCE was nudged higher to 2.6%, showing slightly firmer inflation.
CapEx And Labor Show Strength
- Durable goods orders unexpectedly rose 2.9% and core orders gained, indicating ongoing CapEx strength.
- Weekly jobless claims fell to 218,000, underscoring labor market resilience.