U.S. equities edged lower overnight as investors digested mixed corporate updates and ongoing geopolitical developments. At the close, the Dow Jones fell 0.52%, the S&P 500 slipped 0.28%, and the NASDAQ dipped 0.08%. Nvidia rose after news that the U.S. has approved chip exports to the United Arab Emirates under a bilateral AI partnership, following the UAE’s commitment to a reciprocal level of investment in the United States. Meanwhile, Ferrari shares posted their steepest intraday decline since 2016, after the company issued a cautious outlook despite slightly raising its full-year profit and revenue forecasts. Ferrari now expects 2025 net revenue of €7.1 billion and outlined longer-term guidance through 2030.

Commentary from Industry Leaders

This week I looked at insights from the UBS Family Office Fourth Quarter 2025 publication. UBS Chief Investment Officer Mark Haefele describes artificial intelligence as one of the defining forces behind market gains, but warns of short-term “capex indigestion” as major tech firms ramp up AI investment. Capex among the Big Four tech companies has surged from USD 151 billion in 2022 to USD 228 billion in 2024 and is expected to climb further, outpacing revenue growth and pressuring margins.

Mark believes, however, that AI exposure will be essential to portfolio growth over the medium to long term. Usage is accelerating, with ChatGPT exceeding 400 million weekly active users and 80% of Fortune 500 companies now using AI agent services. As adoption scales, monetisation opportunities are expanding across sectors from retail personalisation to healthcare analytics.

UBS projects global AI capex to reach USD 500 billion by 2026, underpinned by an estimated USD 1.5 trillion annual revenue opportunity if AI automates roughly one-third of economic tasks. While near-term volatility is likely, the CIO underscores that AI’s transformative potential will define the next market cycle, amplifying the benefits of being positioned in the right sectors and the risks of being in the wrong ones.

Economic News  

The U.S. government shutdown has entered its ninth day, with the Senate once again failing to pass funding proposals. Neither party appears close to compromise, and essential services continue to face operational strain as agencies navigate furloughs and staffing challenges.

One of the most significant consequences of the shutdown is the disruption to key economic data releases. Reports including initial jobless claims, construction spending, and September non-farm payrolls have been postponed, leaving markets without critical insights into the state of the labour market and broader economic momentum.

President Donald Trump has signalled that the administration may move to cut several Democrat-backed programs that are unpopular with Republicans. The comments suggest the shutdown may be used as leverage to reshape federal spending priorities, heightening uncertainty around the timeline for a resolution.

Market Snapshot 

• Australia: Currently down -0.13%.

• United States: Dow -0.52%, S&P 500 -0.28%, Nasdaq -0.08%. 

• Bonds: US 10-year yield at 4.14% and Australian 10-year yield at 4.34%.  

• Gold: Declined overnight.

Key Events Coming Up

• Wednesday, October 15, 2025: US CPI Data (Sep)

• Thursday, October 16, 2025: US PPI Data (Sep)

Business Event

Last Thursday RiverX hosted over 100 clients and partners at Smoke, Barangaroo House. An evening defined by meaningful conversations and new connections across Australia’s financial landscape. 

Events like these remind us that finance is as much about relationships as it is about returns, the exchange of ideas, the alignment of purpose, and the strength of partnerships that last well beyond the cycle.

We look forward to hosting our next event soon, bringing together Australia’s brightest minds in wealth, investment, and advisory to continue shaping the future of finance.

Investment Update

As I was walking through Martin Place today at 2pm I couldn't help but notice the very long line up at the front of ABC Bullion...it made me wonder how many were buying gold on hype or strategically allocating? At 2:09pm, this screenshot above shows a headline in the Australian Financial Review...the decline is due to the tension in the Middle East cooling. 

Gold prices surged past US$4,000 per ounce this week, marking a new record high and extending one of the strongest rallies in modern history. The metal is now up over 50% year-to-date, supported by a wave of safe-haven demand amid geopolitical uncertainty, ongoing fiscal concerns in the U.S., and expectations of future rate cuts by major central banks. Central banks have continued to boost reserves, while ETF inflows and institutional rotation into precious metals have accelerated. The weakening U.S. dollar and limited new supply have further underpinned prices. Gold miners have also benefited, with the S&P Global Gold Mining Index climbing more than 120% this year, outpacing even leading technology stocks.

Silver has followed suit, rising alongside gold to trade near US$47 per ounce, its highest level since 2011. The metal has benefitted not only from safe-haven demand but also from its dual role as both a precious and industrial metal. Rising investment in renewable energy, electric vehicles, and solar infrastructure has driven demand for silver, which is critical in photovoltaic cells and electrical components. As a result, industrial consumption now accounts for more than half of total global silver demand.

However, investors should remain cautious of short-term risks. Both metals are in technically overbought territory, and profit-taking could lead to temporary pullbacks. If inflation stabilises faster than expected or the Federal Reserve delays rate cuts, rising real yields could weigh on precious metals. A stronger U.S. dollar or easing geopolitical tensions may also moderate demand.

Despite these near-term risks, gold and silver continue to play strategic roles in diversified portfolios. Gold remains a key store of value and volatility hedge, while silver offers higher beta exposure with potential upside tied to industrial demand. Investors may consider maintaining balanced exposure, using market dips as opportunities to accumulate positions rather than chasing momentum at elevated levels.

As gold prices move into record territory, this rally reflects more than short-term momentum, it’s a structural shift driven by global uncertainty, tightening supply, and renewed institutional demand. If you’d like to discuss how we’re positioning client portfolios to capture this move, across both direct exposure and select gold-linked opportunities please let me know a convenient time for a brief call.