September 2nd, 2025,Newsletter

Dear Friends,

Tangents: Happy September!
Carolann is away from the office today; I will be writing the newsletter on her behalf.

September 2, 1789: The U.S. Treasury Department was established. Alexander Hamilton was the first Secretary of The Treasury and began serving on September 11, 1789. Go to article
September 2, 1935: Labor Day hurricane makes landfall in Florida, killing 423 people, the strongest and most intense hurricane ever to make landfall in the United States
September 2, 1941: Academy copyrights Oscar statuette
September 2, 1974 US President Gerald Ford signs Employee Retirement Income Security Act – sets minimum standards for pension plans

New research has created the first comprehensive effort to categorize all the ways AI can go wrong, with many of those behaviors resembling human psychiatric disorders.

Space weather experts warn that a “strong” geomagnetic storm will rock Earth on Sept. 1-2, potentially lighting the skies with vibrant auroras across large parts of North America. The disturbance is being triggered by a rare, cannibalistic ejection from the sun.

Human sacrifices dating back around 2,300 years have been found near an ancient temple in Peru.

PHOTOS OF THE DAY

Winner – landscape: The Beast
‘I love the raw power and beauty of storms. Watching this severe storm making its way to me, I was filled with excitement and anticipation. To capture the only CG (cloud-to-ground) bolt to come from this amazing shelf cloud was absolute bliss. Once again, thank you Mother Nature!’ Kabi Kabi country, Kings Beach, Queensland.
Photograph: Darren Wassell

Finalist – landscape: Enchanted Forest
‘On a camping trip with my son, we came across this amazing section of silver beech that were stunted and beautifully sculpted by the elements. After several attempts, I was finally present when it snowed. Not long after dawn, the clouds departed, and the low angled sun added a hint of warmth to the fairytale scene.’ Te Rua-o-te-Moko/Fiordland, New Zealand.
Photograph: William Patino

Finalist – monochrome: Transpiration
‘While driving home from a pre-dawn shoot in the Meander Valley, I stopped to admire the dawn breaking behind a young Blackwood tree. Its silhouette struck a beautiful contrast as the sun warmed its transpiring leaves, with the evaporating water droplets rising from the branches to mingle with the surrounding mist.’ Tommeginne country, Deloraine, Tasmania.
Photograph: Joy Kachina
Market Closes for September 2^nd, 2025

International Markets

Bonds

Currencies

Commodities

Market Commentary:
“The customer’s perception is your reality.” — Kathryn M Zabriskie “Kate”
Canada
By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite rose for the fifth day, climbing 0.2%, or 51.17 to 28,615.62 in Toronto.
Brookfield Corp. contributed the most to the index gain, increasing 1.3%.
Torex Gold Resources Inc. had the largest increase, rising 11.0%.
Today, 92 of 211 shares rose, while 118 fell; 4 of 11 sectors were higher, led by materials stocks.

Insights
* This year, the index rose 16%, heading for the best year since 2024
* This quarter, the index rose 6.5%
* The index advanced 23% in the past 52 weeks. The MSCI AC Americas Index gained 14% in the same period
* The S&P/TSX Composite is at its 52-week high and 28.7% above its low on April 7, 2025
* The S&P/TSX Composite is up 1.6% in the past 5 days and rose 5.9% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 20.1 on a trailing basis and 17.8 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.5% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.58t
* 30-day price volatility fell to 9.73% compared with 9.74% in the previous session and the average of 9.79% over the past month
Index Points
Materials | 73.6692| 1.7| 34/14
Energy | 11.6457| 0.3| 26/14
Financials | 8.9983| 0.1| 11/13
Health Care | 0.8002| 1.2| 2/1
Utilities | -2.2269| -0.2| 3/11
Industrials | -4.1826| -0.1| 8/20
Communication Services | -4.9572| -0.8| 1/4
Consumer Staples | -4.9653| -0.5| 1/9
Real Estate | -7.4949| -1.4| 1/18
Consumer Discretionary | -8.2810| -0.9| 2/7
Information Technology | -11.8392| -0.4| 3/7
Brookfield Corp | 11.7400| 1.3| -2.8| 10.7
Canadian Natural |Resources | 9.0870| 1.4| 11.9| -0.6
Bank of Montreal | 7.8530| 0.9| -28.6| 20.2
TD Bank | -4.4590| -0.4| -40.0| 34.3
Cameco | -6.9750| -2.2| -2.3| 40.6
Shopify | -19.3500| -1.2| -23.3| 25.3
(MT Newswires)
A late rally brought another record close Tuesday on the Toronto Stock Exchange on Tuesday, its seventh over the last eight sessions, as higher commodity prices offset some profit taking on investors returned to action after the Labour Day holiday weekend.
The resources heavy S&P/TSX Composite Index closed up 51.17 points to 28,615.62, recovering from 110 points lower around midday, with just about more sectors higher than not.
Among sectors, the Battery Metals Index was up 2.2%, Health Care up 1.4% and Energy up near 1%.
Base Metals was the biggest loser, but it was still down a modest 0.8%.
Of commodities, gold traded at a fresh record high late afternoon on Tuesday, boosted by expectations for a coming interest rate cut and safe haven buying even as the dollar was sharply higher.
Gold for December delivery was up US$81.30 to US$3,597.40 per ounce, climbing from Friday’s record close of US$3,516.10.
In individual gold stocks, Torex (TXG.,TO) was up 11% despite no fresh news since it moved last July to buy Prime (PRYM.TO).
BNN Bloomberg noted TXG is up 95% over one year.
Also, West Texas Intermediate crude oil closed higher on supply concerns even as OPEC+ a day earlier completed its return of 2.2-million barrels per day of production cuts with a final 548,000 bpd tranche of additional supply ahead of the group’s coming meeting to decide on future output.
WTI crude oil for October delivery closed up $1.58 to settle at US$65.59 per barrel, while November Brent oil was last seen up $1.00 to US$69.15.
Wells Fargo Investment Institute (WFII) released its latest Investment Strategy Report in which it said it expects “mixed performance” from commodities in the near term as concerns of economic weakness grow and its energy outlook softens.
Looking into 2026, WFII expects a modest rebound in performance, in line with the economic recovery that it anticipates.
But despite its neutral rating on commodities, WFII sees strengths in favorably rated sectors, Precious Metals and Industrial Metals.
Elsewhere, small crude and product draws are expected this week, according to a Macquarie strategist.
Energy strategist Walt Chancellor said Macquarie Group is forecasting U.S. crude inventories down 1.1-million barrels for the week ending August 29.
This follows a 2.4-million-barrel draw in the prior week, with the crude balance “realizing slightly tighter” than Macquarie’s expectations.
Chancellor added: “As we have previously noted, we believe persistently strong implied supply has been a key feature of the US crude oil balance across Q3 to date.
As such, with US oil production exiting Q2 at a record 13.6 MBD in June, we see potential for this figure to move higher as subsequent monthly data is reported.”
For this week’s balance, from refineries, Macquarie models a minimal reduction in crude runs.
Among net imports, it models a slight decrease, with exports (+0.3 MBD) and imports (+0.2 MBD) higher on a nominal basis.
Chancellor said timing of cargoes remains a source of potential volatility in this week’s crude balance.
From implied domestic supply (prod.+adj.+transfers), Macquarie again looks for an increase (+0.3 MBD) on a nominal basis this week.
Rounding out the picture, the bank anticipates a smaller increase (+0.5 MM BBL) in SPR stocks this week.
Among products, Macquarie looks for a “healthy” gasoline draw (-3.0 MM BBL) largely offset by builds in distillate (+1.4 MM BBL) and jet (+1.0 MM BBL).
The bank models implied demand for these three products at about 14.5 MBD for the week ending August 29.
US
By Rita Nazareth
(Bloomberg) — Wall Street kicked off September on a sour note, with stocks joining a slide in bonds amid heavy corporate- debt sales and developed-world budget worries.
The dollar rose.
Gold hit a record high.
US 30-year yields approached 5%, pressuring tech shares whose valuations have widened during a surge from April lows.
While the S&P 500 trimmed its losses, almost 400 of its shares fell.
All megacaps slipped, with Nvidia Corp. seeing its longest slump since March.
In late hours, Alphabet Inc. jumped as a federal judge ruled Google doesn’t have to sell its Chrome web browser.
Along with a slew of corporate sales, there’s been renewed concern about longer-dated global debt after years of issuance exacerbated budget deficits.
In the UK, the yield on long-dated bonds hit the highest since 1998 and the pound sank as pressure mounted on Prime Minister Keir Starmer to manage the budget.
“Wake me up when September ends!” said Thomas Tzitzouris at Strategas.
“We’ve been suspicious that September was going to be a volatile month, and day one is proving to be every bit as volatile as advertised.”
President Donald Trump said his administration would ask the Supreme Court for an expedited ruling in hopes of overturning a federal court decision that many of his tariffs were illegally imposed.
“The stock market’s down because the stock market needs the tariffs.
They want the tariffs,” he noted.
“Less tariff income means more US debt sales to cover spending deficit,” said Scott Wren at Wells Fargo Investment Institute.
As traders come back to their desks from summer vacations, they’re facing a host of concerns ranging from key economic data to US tariffs, Federal Reserve independence, monetary policy as well as global fiscal prospects.
The events arrive with the stock market seemingly at a crossroads after the S&P 500 posted its smallest monthly gain since July 2024 just ahead of what’s historically known as the weakest month for equities.
“As if we all weren’t bummed enough about the end of summer, the markets gave us all a slap in the face today to get investors back into reality,” said Bespoke Investment Group strategists.
Of course, there are fundamental reasons to support the S&P 500’s rally from April lows, with the economy staying relatively resilient as Corporate America’s profit engine keeps roaring.
But with so much uncertainty, investors have become increasingly concerned that the market is overvalued.
The US benchmark trades at 22 times analysts’ average earnings forecast for the next 12 months.
Since 1990, the market was only more expensive at the height of dot-com bubble and the technology euphoria coming out of the depths of the Covid pandemic in 2020.
“Outside of a September surprise, investors face ongoing threats from trade and tariff unknowns as well as potential economic releases that might show weaker-than-expected trends that could ultimately challenge elevated stock valuations,” said Anthony Saglimbene at Ameriprise.
“That said, investors have been navigating those dynamics for months, and stocks have continued to grind higher.”
In Saglimbene’s view, investors should maintain a diversified portfolio, remain cautiously optimistic about the investment landscape, based on a solid foundation of growth, and look through potential September volatility, should it develop.
“Downturns in markets always feel bad, and there are always reasons to say ‘this time is different.’
But pulling back and looking through a longer-term lens, downturns tend to be shallow and quick,” said Chris Fasciano at Commonwealth Financial Network.
“Stay vigilant to headlines that might impact the economy, but pay attention to the fundamentals.
They drive long- term performance. Always.”
The S&P 500 closed out August near an all-time high, defying a narrative that, just weeks ago, may have appeared less favorable, according to Invesco Global Market Strategy Office.
“As we head into September and October, we’ll likely hear echoes of the same concerns, including seasonality, policy risks, and valuations,” Invesco said.
“But we see little evidence that the cycle is ending. Macro data and market signals continue to suggest otherwise.”
This year is just the sixth time since 1928 that the S&P 500 was up at least 1% in May, June, July, and August, according to Bespoke.
Following the five prior occurrences, the gauge was mixed in September — but traded higher in the last four months of the year all five times, the firm said.
Despite the potential for volatility and short-term pullbacks in September, UBS’s Chief Investment Office believes investors who are under-allocated to equities should consider phasing in and using market dips to add equity exposure.
The firm expects the S&P 500 to reach 6,800 by end-June 2026, supported by factors such as earnings momentum, Fed rate cuts and as the long-term artificial-intelligence trend remains intact.
“We recommend that investors who are under-allocated to equities consider phasing in and using market dips to add exposure to preferred areas,” said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management.
“Alongside AI, power and resources, and longevity, we favor US technology, health care, utilities, and financials.”
US stocks will continue rallying after four months of gains as Fed rate cuts coincide with robust corporate earnings, according to Morgan Stanley’s Michael Wilson.
“We push back on the idea that rate cuts are already priced,” Wilson wrote in a note.
“We’re respectful of the upcoming weak seasonal window but remain buyers of dips should they come.”
Focus this week is on key labor market data for clues on economic growth and the Fed’s policy outlook.
Employers in the US showed little enthusiasm to take on workers during August, and the unemployment rate probably ticked up to an almost four- year high, adding to evidence of a more subdued jobs market.
The importance of this week’s economic data will ultimately drive where yields are by Friday’s close – even if there is a lot that could shift investors’ perception of the state of the labor market in the interim,” said Ian Lyngen and Vail Hartman at BMO Capital Markets.
“While technically it was a Tuesday, the Treasury market most certainly traded it like a late-summer Monday,” the BMO strategists said.
“The bearish tone in US rates suggests that the story is very much one of supply concern rather than the macro fundamentals.”
They also noted that the combination of the holiday- shortened week and the relevance of Friday’s jobs data does complicate the timing of bringing new deals to market, although with the deal count quickly mounting, it is difficult to ignore the upward pressure on yields associated with rate-lock selling.
US PREVIEW: July JOLTS to Show More Labor-Market Cooling On the economic front, US factory activity shrank in August for a sixth straight month, driven by a pullback in production that shows manufacturing remains bogged down by higher import duties.
“The ISM manufacturing report indicated that companies are largely managing headcount rather than actively hiring,” said Scott Helfstein at Global X.
“This may be a clue ahead of Friday’s jobs numbers. New jobs are likely slowing, but meaningful revisions to data over the prior months could mean that the report, good or bad, may not influence investors much.”
Helfstein says investors should pay close attention to wage growth in Friday’s job report.
“Wages have been outpacing inflation and that is usually a good sign for consumption. While defaults are going up slightly, most of the numbers on consumer behavior have remained robust,” he noted.
Swap markets are currently pricing in more than 20 basis points of Fed easing in September, with a bit more than two quarter-point reductions priced by the end of 2025.

Corporate Highlights:
* The US has revoked Taiwan Semiconductor Manufacturing Co.’s authorization to freely ship essential gear to its main Chinese chipmaking base, potentially curtailing its production capabilities at that older-generation facility.
* Deliveries from Tesla Inc.’s Shanghai factory extended their slump in August as new products launched by Chinese rivals win over customers and global trade uncertainties persist.
** Tesla’s long-awaited entry into India has delivered underwhelming results so far, with tepid bookings fueling fresh doubts about the company’s global growth outlook.
* Apple Inc.’s lead artificial-intelligence researcher for robotics has departed the company to join Meta Platforms Inc.’s competing effort, part of an exodus of AI talent from the iPhone maker.
* The European Union paused its immediate plans to punish Alphabet Inc.’s Google for abusing its dominance over advertising technology amid fears that US President Donald Trump could hit back by derailing a transatlantic trade deal.
* Kraft Heinz Co. said it plans to split into two separate companies, undoing a mega-deal ushered in a decade ago that turned the maker of Kraft Mac & Cheese into one of the largest packaged food sellers in the world.
** Warren Buffett said he’s disappointed in the planned split of Kraft Heinz, though he concedes the merger he orchestrated a decade ago wasn’t a brilliant idea.
* Target Corp. sank after the American Federation of Teachers, the second-largest US teacher’s union, endorsed a boycott against the retailer’s decision to end some diversity programs amid pressure from conservative activists and the US government.
* Air Lease Corp., the aviation finance firm built by industry pioneer Steven Udvar-Hazy, agreed to a $7.4 billion sale to a group led by Sumitomo Corp., adding to consolidation in an sector that plays an increasingly important role in aircraft purchases.
* Klarna Group Plc and some of its shareholders are seeking to raise as much as $1.27 billion as thefinancial-technology company revives a New York initial public offering that wasdelayed earlier this year amid market volatility.
* Activist investor Elliott Investment Management has built a stake of about $4 billion in PepsiCo Inc., with plans to call for changes at the struggling beverage maker.
* Paramount Skydance Corp. has struck a deal with Microsoft Corp.’s Activision video-game unit to develop and produce a live-action film based on the Call of Duty franchise, the company said in a statement Tuesday.
* Signet Jewelers Ltd., the owner of the Zales and Jared chains, raised its full-year sales guidance as consumers continued to spend on jewelry despite signs of a slowdown for other discretionary goods.
* Constellation Brands Inc. cut its fiscal 2026 guidance, citing weak consumer demand, which will hurt inventory rebalancing at the distributor level.
* Apollo Global Management Inc. is poised to launch a $5 billion strategy to invest in sports deals, marking another major asset manager targeting the booming sector.
* OpenAI has agreed to buy product testing startup Statsig for $1.1 billion in an all-stock deal, the company said, marking one of the largest acquisitions in the ChatGPT maker’s history.

Some of the main moves in markets:
Stocks
* The S&P 500 fell 0.7% as of 4 p.m. New York time
* The Nasdaq 100 fell 0.8%
* The Dow Jones Industrial Average fell 0.5%
* The MSCI World Index fell 0.9%
* Bloomberg Magnificent 7 Total Return Index fell 1.1%
* The Russell 2000 Index fell 0.6%
Currencies
* The Bloomberg Dollar Spot Index rose 0.5%
* The euro fell 0.6% to $1.1642
* The British pound fell 1.1% to $1.3392
* The Japanese yen fell 0.8% to 148.35 per dollar
Cryptocurrencies
* Bitcoin rose 1.8% to $110,806
* Ether fell 0.4% to $4,274.05
Bonds
* The yield on 10-year Treasuries advanced four basis points to 4.27%
* Germany’s 10-year yield advanced four basis points to 2.79%
* Britain’s 10-year yield advanced five basis points to 4.80%
* The yield on 2-year Treasuries advanced two basis points to 3.64%
* The yield on 30-year Treasuries advanced four basis points to 4.96%
Commodities
* West Texas Intermediate crude rose 2.5% to $65.62 a barrel
* Spot gold rose 1.8% to $3,537.46 an ounce

Have a wonderful evening everyone.

Be magnificent!

As ever,

Shab
“The purpose of computing is insight, not numbers.”– Richard Wesley Hamming

Shab Mohammadpour
Assistant to Carolann Steinhoff
Queensbury Securities Inc.

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Victoria BC  V8W 3Y7
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