Stocks Up: Retail Sales Paint Healthy Picture
Published as of: September 16, 2025, 9:11 a.m. ET
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| The markets | Last price | Change | % change |
|---|---|---|---|
| S&P 500® index | 6,615.28 | +30.99 | +0.47% |
| Dow Jones Industrial Average® | 45,883.45 | +49.23 | +0.11% |
| Nasdaq Composite® | 22,348.75 | +207.65 | +0.94% |
| 10-year Treasury yield | 4.05% | +0.02 | -- |
| U.S. Dollar Index | 97.03 | -0.26 | -0.27% |
| Cboe Volatility Index® | 15.64 | -0.05 | -0.32% |
| WTI Crude Oil | $64.05 | +$0.75 | +1.17% |
| Bitcoin | $115,650 | +$55 | +0.05% |
Disclosure
Major index values are as of Monday's close; others are as of 8:53 a.m. ET.
(Tuesday market open) U.S. shoppers kept loading their carts last month even as economic indicators sagged. Retail sales rose 0.6% in August, well above the 0.3% analyst consensus, and major indexes kept their pre-market gains after the data.
"Consumer demand has generally held up despite a softer labor market," said Collin Martin, director, fixed income strategy at the Schwab Center for Financial Research. "The Fed will still likely cut rates tomorrow, but a resilient economy and above-target inflation may prevent the Fed from cutting as much as the markets are expecting over the next few quarters."
Early today, the CME FedWatch Tool priced in 96% odds of a 25-basis point rate cut and 4% odds of a 50-basis point rate cut at tomorrow afternoon's meeting. And an appeals court ruled against President Trump's attempt to fire Fed Governor Lisa Cook, meaning she'll participate. On Monday, markets continued their "melt up" momentum amid a positive backdrop for the AI investment cycle and hopes of falling interest rates. Trump's optimism around China trade negotiations also had traders in a bullish mood, and Trump teased a TikTok deal. Against this backdrop, the S&P 500 index closed above 6,600 for the first time and the Nasdaq Composite reached another new all-time high. Trading could be muted today, however, approaching the Fed decision.
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Three things to watch
- Retail sales deeper dive: Last month's solid retail sales kept their positive pace after an upwardly revised 0.6% increase in July. Removing automobiles, August's headline was 0.7%. This kind of data might clash with other numbers investors saw last month, especially slower jobs growth. "The retail sales report suggests that consumers continue to consume," Martin said. "Tariffs don't appear to be slowing down purchases as most segments of the retail sales report showed monthly increases." Burrowing into the report, the so-called "control group" retail sales number—which excludes sales from auto dealers, building materials stores, and gas stations—rose 0.7% in August after climbing 0.5% in July, which Martin said represents "more proof of the resilient economy and suggests that 3Q gross domestic product, or GDP, should remain at or near trend growth."
- Taking the pulse of manufacturers: The first of this week's several snapshots of the nation's factories indicated the manufacturing sector may be slowing down and unlikely to hire new workers in coming months. The headline index from the New York Federal Reserve’s Empire State Manufacturing Survey came in below expectations, dropping into negative territory for the first time since June. New orders and shipments tumbled to their lowest levels since April 2024. Companies expect conditions to improve in the months ahead, but confidence is subdued, and the gauge of future employment fell to almost zero, a "rare occurrence" that means factories don't expect to add any jobs over the next six months. The sector lost 42,000 jobs from April through August. Next up, the government will release August industrial production data this morning. On Thursday, the Philadelphia Fed will release its manufacturing survey.
- Housing under a microscope: Though this week is relatively light on data and earnings, it could give investors a closer look at the housing market, a key economic component that's struggled for months. Wednesday features August housing starts and building permits data, followed Thursday by earnings from home builder Lennar (LEN). Mortgage applications picked up last week as rates fell, but one week isn't a trend. "There are debt constraints down the income spectrum, and that's where defaults and delinquencies are picking up, but there's been this greater aversion to taking on additional leverage," said Liz Ann Sonders, chief investment strategist at Schwab, in a recent analysis. "And I think that's been one of the reasons why we've seen the housing market relatively weak."
On the move
- Tesla (TSLA) gained almost 3.6% on Friday after CEO Elon Musk reported an insider purchase of nearly $1 billion—his first public transaction since 2020. With this move, the volatile stock entered positive territory for the year.
- Oracle (ORCL) jumped 5.6% ahead of the open after CBS News reported that Oracle could "play a key role" in a TikTok deal between the Trump administration and China. According to CBS, which cited sources with knowledge of negotiations, Oracle "is among a consortium of firms that would enable TikTok to continue operations in the U.S. if a framework deal between the U.S. and China is finalized."
- Joining an exclusive club of highly valued companies, Alphabet (GOOG) saw its market cap cross the $3 trillion threshold for the first time on Monday, thanks to a 4.3% gain on news that its AI app, Gemini, was outpacing its rivals in terms of downloads. Also above the triple-trillion mark? Nvidia (NVDA), Apple (AAPL), and Microsoft (MSFT).
- Novo Nordisk (NVO) added 2.7% this morning after positive Phase 3 data on the company's next generation weight-loss drug.
- CoreWeave (CRWV) closed up 7.6% yesterday following news that NVDA placed an order worth "at least" $6.3 billion on cloud infrastructure technology. CoreWeave received an upgrade to Outperform from Market Perform from Citizens JMP.
- Dave & Buster's Entertainment (PLAY) cratered 18.8% ahead of the open after earnings missed analysts' expectations. Revenue also missed forecasts and sales at stores open a year or more dropped 3%.
- Seagate Technologies (STX) rallied 7.7% on elevated volume, following an upgraded price target from Bank of America.
- Hershey (HSY) popped nearly 3% this morning following an upgrade by Goldman Sachs to Buy from Sell, with the firm saying shares trade at a level that offers "compelling risk/reward."
- Amid news of a Federal Trade Commission (FTC) investigation into the presence of bots, Live Nation (LYV) dipped in after-hours trading Monday but is fresh off an all-time high.
- While not expected to report earnings again until early November, Alaska Air (ALK) is already predicting its profit will be toward the low end of earlier estimates, citing rising fuel costs and a technology outage in July. The stock fell 6.7% Monday.
More insights from Schwab
Concentration risk: Just because a small group of stocks carries outsized weight in an index like the S&P 500 doesn't mean they're outperformers. In fact, three of the Magnificent Seven stocks are lagging the broader index this year, underscoring the risk of overweighting mega-cap stocks in a portfolio. Learn more from Schwab's Chief Investment Strategist Liz Ann Sonders and Kevin Gordon, senior investment strategist, in Every Brea(d)th You Take: Market Concentration Risks.
Travel smart: Learn five simple ways to cut costs on domestic travel while still enjoying great experiences. Mark Riepe, chief of the Schwab Center for Financial Research, walks through the strategies on the latest episode of the Financial Decoder podcast.
Chart of the day
Data source: FTSE Russell. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
While other stock indexes have been reaching new all-time highs, the Russell 2000® Index (RUT—candlesticks) of small caps continues to flirt with its previous all-time high of 2,466.49, reached last November. Looking at its relative strength compared to the S&P 500 (blue line), the RUT has held its own, showing strength ever since April's market bottom. At Monday's close, the index was just 2.5% shy of this former peak. A move beyond this level could spark renewed interest in small-cap names. Among the "biggest" constituents by market cap in this sizable collection are EchoStar (SATS), Hims & Hers (HIMS), and Bloom Energy (BE).
The week ahead
Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.
September 17: August housing starts and building permits, FOMC rate decision and projections, and expected earnings from General Mills (GIS) and Cracker Barrel (CBRL).
September 18: Expected earnings from FedEx (FDX), Lennar (LEN), and Darden (DRI).
September 19: Bank of Japan rate decision.
September 22: No major earnings or data expected.
September 23: August existing home sales and expected earnings from Micron (MU) and AutoZone (AZO).
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