The S&P 500 fell for a third consecutive session, closing 0.5% alongside the Nasdaq, while the Dow Jones slipped 0.38%. Major U.S. technology names were weaker, with Tesla down 4.38% and Oracle off 5.53%. Meanwhile, gold prices surged to all-time highs, a traditional signal of rising investor caution.

Commentary from Industry Leaders

This week I looked at insights from Morgan Stanley’s Chief Investment Officer Lisa Shalett, on the outlook of markets and issues that will directly shape investor positioning into year end. 

From Morgan Stanley’s Global Investment Committee, Lisa Shalett mentioned that the Fed’s easing cycle provides near-term support for equities, but investors should be cautious of extrapolating this into a sustained bull run.

Corporate earnings growth is slowing, as margins are pressured by sticky wage inflation and higher financing costs. Lisa also noted that while US equities remain resilient, leadership is narrow and valuations elevated.

She recommends tilting portfolios toward quality equities with strong balance sheets, alongside real assets (gold, REITs, energy infrastructure, and commodities) and credit exposures backed by solid collateral. The key, she argues, is to focus on durability of earnings and income streams rather than chasing short-term momentum. 

This strategy reduces the reliance on traditional bond/equity correlations. 

Economic News 

The U.S. economy posted its fastest pace of growth in nearly two years during the second quarter, with GDP revised up to 3.8% annualised. Strength was driven by resilient consumer spending and firm business investment, while durable goods orders also came in ahead of expectations. Weekly jobless claims fell by 14,000 to 218,000, well below consensus forecasts of 235,000, underscoring continued labour market resilience.

That said, momentum may begin to cool as tariff impacts and broader uncertainty weigh on the outlook. For investors, the focus now shifts to the Fed’s preferred inflation gauge, the core PCE price index, which will provide critical guidance on the central bank’s policy path in the months ahead.

The White House announced it will impose a 100% tariff on imports of branded or patented pharmaceutical products beginning October 1, unless the manufacturer is actively building a production facility in the U.S. The move is part of a broader push to onshore critical drug manufacturing, reduce reliance on foreign supply chains, and encourage investment in domestic production capacity. 

This development could have wide-ranging impacts. In the near term, global pharmaceutical companies without U.S.-based manufacturing may face significant earnings headwinds, while U.S. domiciled firms could benefit from a relative cost and pricing advantage.

Investors should expect volatility in the healthcare sector, particularly in large-cap pharma with significant overseas production. Beyond healthcare, the policy underscores a broader trend of supply chain reshoring, which may benefit U.S. industrials, specialty construction firms, and advanced manufacturing companies tied to new plant development. For portfolios, this adds another dimension to the ongoing theme of geopolitical fragmentation and trade policy risk, which continues to shape sector leadership and global capital flows.

Market Snapshot 

• Australia: ASX is flat today, healthcare sector is down.

• United States: Dow 0.38%, S&P 500 0.5%, Nasdaq 0.5%. 

• Bonds: US 10-year yield at 4.17% and Australian 10-year yield at 4.34%.  

• Gold: Increased overnight.

Key Events Coming Up

• Tuesday September 30: RBA Interest Rate Decision.

Investment Update

Earlier this year, clients were offered the opportunity to participate in the Cavill Lane Trust, an unlisted property fund launched by Boston Global and The Property Factory. The fund acquired Cavill Lane, a prime $31 million retail asset in the heart of Surfers Paradise, Gold Coast, one of Australia’s premier tourist destinations. The property comprises 4,344 sqm of retail space, 113 secure underground car parks, and a diverse tenant mix including restaurants, cafes, convenience services, and entertainment venues. With a WALE of over five years and occupancy above 97%, the investment was structured to deliver forecast distributions of 10.3% p.a. (average over five years) and a base case IRR of 16.2% (post fees, pre-tax). The trust is now closed, but the offering highlighted our ability to source high-quality, income-generating real assets for clients, underpinned by strong tourism, population growth, and upcoming infrastructure developments in the Gold Coast region.

Let me know if you are looking to add some institutional-grade commercial property to your investment portfolio.