Rate Cuts, Cracking AI Stocks, and What Comes Next

In partnership with

Good morning & Happy Friday.

Markets are limping toward the weekend after another bout of AI volatility, with rate-cut hopes creeping back just as tech valuations wobble. Between Fed whispers, a sharp rotation out of momentum names, and fresh warning signs from the data, investors are being forced to slow down and think.

Grab your coffee and let’s get into it! ☕️

7 Ways to Take Control of Your Legacy

Planning your estate might not sound like the most exciting thing on your to-do list, but trust us, it’s worth it. And with The Investor’s Guide to Estate Planning, preparing isn’t as daunting as it may seem.

Inside, you’ll find {straightforward advice} on tackling key documents to clearly spell out your wishes.

Plus, there’s help for having those all-important family conversations about your financial legacy to make sure everyone’s on the same page (and avoid negative future surprises).

Why leave things to chance when you can take control? Explore ways to start, review or refine your estate plan today with The Investor’s Guide to Estate Planning.

Download your free guide now!

📈Market News

Stocks Slide as AI Leaders Face Valuation Reality Check
U.S. markets pulled back Thursday as investors rotated out of high-flying AI names and into defensives, sending the Nasdaq down ~1.4% and dragging the S&P 500 lower by about 0.8%. Mega-cap leaders that powered most of 2025’s gains saw renewed selling pressure as traders locked in profits. The move wasn’t panic — it was repositioning — but it underscored how narrow this rally has become.

Fed Officials Signal Openness to Early-2026 Rate Cuts
Several Fed speakers struck a softer tone, acknowledging that cooling inflation and slowing hiring may justify cuts sooner than previously expected. Futures markets now price in a greater than 60% chance of a rate cut by March 2026, a sharp shift from just weeks ago. For investors, this keeps the “Goldilocks” narrative alive — but also raises questions about why the economy needs help.

Jobs Data Shows Cracks Beneath the Surface
New labor market data showed continued deceleration, with job growth slowing and participation flattening. While unemployment remains historically low, wage growth is easing, especially in white-collar roles tied to tech and finance. The takeaway: the economy isn’t breaking, but it’s clearly losing momentum — a backdrop that complicates equity valuations.

Oil Slips as Demand Concerns Resurface
Crude prices dipped again, with WTI hovering near recent lows, as traders focused on weaker global demand signals rather than supply risks. Energy stocks followed oil lower, adding pressure to broader indexes. Lower oil helps inflation, but falling demand expectations rarely scream “strong growth.”

💻Tech & Innovation

AI Stocks Feel the Pain as Spending Scrutiny Grows
Investors are starting to question whether massive AI infrastructure spending will deliver near-term returns. Several large-cap tech names slipped after analysts flagged rising capex and thinner margins. AI isn’t the problem - timing is - and Wall Street is no longer willing to pay any price for future dominance.

Apple Faces Pressure to Prove Its AI Strategy
Shares of Apple drifted lower as investors continued debating whether the company’s slower, more private-first AI rollout can compete with rivals’ aggressive deployments. Bulls argue Apple’s ecosystem wins long term; bears say it risks missing a generational shift. The stock is caught between patience and fear of irrelevance.

Enterprise AI Adoption Is Accelerating - Quietly
While consumer-facing AI grabs headlines, enterprise adoption is expanding steadily across logistics, healthcare, and finance. Companies report real productivity gains, not hype demos, but the benefits arrive slowly and unevenly. For investors, this reinforces that AI wealth creation may look more like a marathon than a moonshot.

Regulators Circle AI Data and Security Risks
Policymakers in the U.S. and Europe signaled tighter oversight on AI training data, cybersecurity, and model access. Tech leaders warn regulation could slow innovation, but investors may welcome guardrails that reduce long-term legal and reputational risk.

📊Investing & Strategies

Why Narrow Markets Eventually Punish Complacency
When a handful of stocks drive most returns, portfolios feel diversified but aren’t. History shows these periods often end not with crashes, but with long stretches of underperformance. The lesson: concentration works - until it suddenly doesn’t.

Drawdowns Are the Price of Admission
Even the best-performing strategies endure brutal pullbacks. Long-term winners aren’t those who avoid losses, but those who stay invested through them. Investors chasing smooth returns usually end up buying high and selling low.

Cash Isn’t Trash When Volatility Rises
Holding cash isn’t market timing - it’s optionality. In uncertain environments, liquidity gives investors flexibility to rebalance, deploy during sell-offs, or simply sleep better. Returns aren’t just about upside; they’re about staying in the game.

The Biggest Risk Is Overconfidence
Bull markets quietly convince investors they’re smarter than they are. When narratives feel obvious and risk feels low, that’s often when portfolios become most fragile. Humility remains one of the highest-return traits in investing.

🔮Looking Ahead: Strategy Thoughts

As markets head toward year-end, investors are balancing renewed rate-cut optimism against growing unease around stretched AI valuations and narrowing leadership. The next few weeks are likely to hinge on Fed communication, market breadth, and whether risk appetite can broaden beyond a small cluster of mega-cap winners. With liquidity thinning and positioning crowded, volatility may remain elevated, making discipline, patience, and flexibility more valuable than bold predictions.