Asset Management
11/10/2025 Market Strategy
November 10, 2025
Key Takeaways
We recall some investors had grown weary about stock prices that had ticked up pretty much on a day-to-day basis through recent months (August, September, and October) regarded historically by market participants and observers for their potential to be seasonally and historically fearsome in terms of volatility and downside risk for stocks.
In our view the softening in stock prices reflected in the major indices at present looks like something between a “haircut” and a “trim” rather than the beginning of a more serious period of decline.
ronically this year the aforementioned months were broadly good for stock prices. And then as November approached the memory of how good a month November could be was espoused in many corners of the market only to see stock prices slip and slide. Stocks have bounced between gains and losses from October 28 through last Friday, Nov 7.
Stocks begin this week with the Dow Jones Industrial Average, the S&P 500, the Nasdaq Composite, the S&P 400 (mid-caps), and the Russell 2000 (small-cap) respectively lower from where they had started the prior week by: 1.2%, 1.6%, 3%, and 1.9%.
Ironically the S&P 600 (small-cap) which has been an underperformer is the exception starting this week essentially flat (with a positive bias) having gained 0.16% over the course of the week just ended.
Last week saw market investment soured by a number of things including: little to no progress made in Washington to reopen the US government; heightened concerns about stock valuations along with some worries about how long it will take for all the money that has been directed into AI to be realized in corporate profits.
For all the rending of garments and gnashing of teeth about the recent pullback in stocks heard from the bear camp last week the S&P 500 stood by the close last Friday just 2.35% off from its record close reached on October 28.
The heavily technology-weighted NASDAQ Composite closed last Friday 4% off its latest record high reached on October 29.
For all the attention that seemed to be given the bearish view of late some folks appeared to be forgetting that the S&P 500 and the NASDAQ Composite start this week respectively higher on a year-to date basis up 14.4% and 19.1%.
In the same period the Russell 2000 (small-cap), the S&P 400 (mid-cap) and the S&P 600 (small cap) indices are up 9.1%, 3.9%, and 2.1%.
For all the concern raised by some market participants and observers about the markets’ recent wobbles --- it looks so far to us more like bears, skeptics, and nervous investors are simply “taking some profits without FOMO” (fear of missing out) after a series of powerful bull runs from the start of the year through the high on February 19 and again from the low on April 8 through the high on October 28.
In our view the softening in stock prices reflected in the major indices at present looks like something between a “haircut” and a “trim” rather than the beginning of a more serious period of decline.
Beyond doubt there is good reason for concern about the effect of the government shutdown, the damage incurred so far, and the negative effect it could have on the economy the longer it takes to resolve. That said, in our view it’s the damage politicians on both sides of the aisle could do to themselves by not reopening the government sooner than later in terms of future elections appears to be a suitable and probable consideration for them to find reason to resolve the stalemate and reopen the government before the Thanksgiving Holiday.
When it comes to technology it doesn’t appear to us like the time has come to give up on chips and AI and instead search the desk for the abacus and the slide rule.
Technology remains deeply embedded in the lives of both business and the consumer—and we’re all on the upgrade cycle whether we like it or not.
From the conversations we’ve had with users of AI, it appears like a watershed period in technological development likely to produce greater efficiencies for business and the consumer notwithstanding the disruptions, successes, and even failures that inevitably come with any agent of change across the economic landscape
Comparisons in the run up of stock valuations this cycle to the tech bubble of the late 1990s appear inaccurate to us when one considers the profitability, size, and scope of many of the major companies in the technology and communications services sectors today.
We are not saying that some specific names in the space are not priced rich for comfort but rather that overall valuations may not be so much reflective of the wild speculation in the space during the tech bubble but rather of the fact that the stocks of successful companies in the public markets today are desired by more intermediate and long-term investors looking for solid companies for the long haul for their portfolios.
It’s no secret that private equity has taken companies from the public space as well as extended the incubation periods of new companies over the recent decades. One renowned economist in fact has reminded investors over the years that the Wilshire 5000 index is stretched to reach the number of stocks its name requires as a result of the shortage of names created by the structural shift in the marketplace driven by the popularity and growth of the private markets.
It’s no secret that Social Security cannot be counted on to provide the same level of contribution to income in retirement that it once did for previous generations. As a result, interest in quality investments to supplement what Social Security once provided and what it is expected to provide in the years to come has been elevated as individuals look for stocks that have the potential to meet serious investment goals and objectives across generational demographics to hopefully maintain in retirement standards of living enjoyed when one was still working.
Such interest has increased demand for stocks of companies that are of high quality with the potential to grow revenues and earnings. It looks to us like “Economics 101” – the basics of supply and demand -- that’s contributed to the multiple expansion experienced in recent years as more investors look for stocks that have prospects to grow earnings.
In the equity markets the historic capability of stocks to capture trends and access innovation is well known--and while past performance of course is no guarantee of future results--it may well be a significant driver of this cycle’s multiple expansion in quality and particularly in quality technology stocks.
We remain positive on equities and regard it as our favorite asset class.
Among the sectors, we persist in favoring cyclical sectors over defensive sectors. Our favorite sectors include: information technology, communications services, industrials, financials, and consumer discretionary. The utilities sector as interest rates move lower should gain increased favor as the sector is often considered a bond proxy that can benefit when rates move lower. The sector also has appeal as a thematic sector with prospects for the revitalization of the US electric grid as AI and other technologies increase demand for electricity.
Portfolio diversification among asset classes represented in a portfolio remains important to meet the needs, goals, objectives, and tolerance to risk for private investors and the needs of mandate-driven institutions in an environment which remains in transition on a number of levels including: fiscal policy, monetary policy, geopolitical and domestic politics stateside and around the world.
Chief Investment Strategist, Oppenheimer Asset Management Inc.
John is one of the most popular faces around Oppenheimer: our clients have come to rely on his market recaps for timely analysis and a confident viewpoint on the road forward. He frequently lends his expertise to CNBC, Bloomberg, Fox Business, and other notable networks.
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