The Compound
Wall Street is Firing On All Cylinders | WAYT?
10/14/2025, 10:17:40 PM
Economic Summary
- Major banks reported strong earnings, with investment banking and trading fees rising materially year-over-year, implying real economic activity and deal flow beyond the tech rally (notable tickers: GS, JPM, BAC).
- Wells Fargo (WFC) had its asset cap lifted after governance changes, enabling larger buybacks/dividends and signaling normalization for a major SIFI.
- BlackRock (BLK) manages ~$13.5 trillion AUM; its new digital asset ETF (IBIT) reached ~$100B quickly but digital assets still represent roughly 1% of BlackRock's AUM and fees, so crypto revenues are meaningful but small relative to the firm.
- Federal Reserve comments signaled that balance-sheet runoff could end soon, which could lower medium- and long-term yields and provide additional relief to mortgage rates beyond rate cuts (speaker: Jerome Powell).
- Crypto markets experienced a rapid flash crash with severe liquidity evaporation and mass liquidations, highlighting market-structure fragility and contagion risks.
- Private credit and syndicated loan headlines have raised concerns, but many panelists view reported incidents as idiosyncratic rather than systemic; the episode should reprice risk and increase scrutiny in credit markets.
- Consumer-facing and enterprise software names face structural questions: AI may reduce per-seat SaaS demand, pressuring companies like Salesforce (CRM).
- Corporate travel and airline profitability have rebounded above pre-COVID levels, with Delta (DAL) capturing a large share of industry profits and strong free cash flow.
Bullish
- Big-bank earnings beat indicate broad economic activity beyond tech, supporting financial stocks.
- Wells Fargo cap lift enables buybacks/dividends, improving shareholder returns.
- BlackRock's enormous AUM gives durable fee revenue and scale advantages (digital assets still a small slice).
- Investment banking and trading fees are at multi-year highs, fueling GS and JPM profits.
- Delta is capturing outsized industry profits and has robust free cash flow — premium airline moat.
- Adobe and other mature software franchises show strong free cash flow and deep pullbacks, attractive entry points.
- Nike, Chipotle, Airbnb: large drawdowns with healthy cash flow could present buying opportunities.
Bearish
- Enterprise SaaS faces headcount cuts and AI-driven in-house tools, threatening per-seat revenue (e.g., Salesforce/CRM).
- Crypto market structure is fragile — rapid flash crashes and liquidity evaporation can cause severe losses.
- Private credit and syndicated loan headline failures could reprice credit and increase scrutiny across the asset class.
- Fashion/retail turnarounds are hard; Lululemon drawdown may reflect structural brand risk.
- Some high-profile stocks may already have run too far, inviting short-term profit-taking around earnings momentum.
Bullish tickers
WFCBLKGSJPMDALADBENKECMGABNB
Bearish tickers
CRMLULUCRYPTOPRIVATE_CREDITPLTR
WFC
Bullish
Asset cap lifted, enabling buybacks and dividends; first full quarter without cap improves shareholder prospects.
Bearish
Historically troubled bank with governance risks; some lingering skepticism despite improvements.
JPM
Bullish
Driving large financing deals and on pace for robust profits as investment banking and markets activity accelerates.
Bearish
Underperformed the KBW Bank Index on the day despite strong results, susceptible to short-term profit-taking.
GS
Bullish
Investment banking and markets division on pace for record performance; active deal flow boosting fees.
Bearish
Like peers, can be hit by short-term trading dynamics despite solid fundamentals.
BLK
Bullish
Massive AUM (~$13.5T) and dominant ETF distribution give durable fee revenue and scale advantages; IBIT scaled quickly.
Bearish
Digital asset exposure is small but headline risks in alternatives and private markets could draw scrutiny.
IBIT
Bullish
BlackRock's Bitcoin ETF scaled to large AUM quickly, proving product-market fit despite being a small share of overall AUM.
Bearish
Rapid flows into crypto ETFs can amplify speculative volatility and present headline risk to managers.
CPAG
Bullish
FM Investments compounder U.S. aggregate bond ETF pitched as avoiding distributions to help compounding.
CPHY
Bullish
FM Investments compounder high yield ETF offering an alternative to regular bond distributions.
HOOD
Bullish
Strong user growth narrative; viewed skeptically versus incumbents like BlackRock in scale comparisons.
Bearish
Questionable relative valuation compared with established asset managers; possible overvaluation concerns.
LULU
Bearish
67% drawdown and fashion category makes turnaround uncertain; structural brand risk.
CRM
Bearish
Risk from AI and lower corporate headcount reducing per-seat SaaS demand; failed to rally on OpenAI partnership.
NKE
2 price targets
5560
Bullish
Large pullback viewed as a strong buying opportunity; suggested buy and add on short false breakdowns.
Bearish
Deep drawdown could reflect demand or margin concerns; technical risk of further breaks.
CMG
Bullish
Free cash flow near all-time highs; drawdown could present a buying opportunity for long-term investors.
Bearish
Consumer sentiment on food quality and pricing could weigh on same-store sales and sentiment.
ABNB
Bullish
Consistent free cash flow growth despite valuation reset; considered a buy by hosts.
Bearish
Came public at a mania valuation and has had sideways performance; competition in lodging persists.
ADBE
2 price targets
330450
Bullish
Free cash flow at highs and 50% drawdown make it an attractive value setup with clear support levels.
Bearish
Concerns that AI tools may reduce demand for professional Adobe licenses and pressure growth.
DAL
Bullish
Market-share gains and 60%+ of industry profits suggest durable premium positioning and strong free cash flow.
Bearish
Airline sector historically volatile and low multiple; cyclical risks remain.
PLTR
Bearish
High multiple speculative name used as a counterpoint; vulnerable to hype cycles.
EA
Bullish
Part of record leveraged buyout activity and deal market; example of hefty deal sizes.
BAC
Bullish
Generating large deal fees in the current deal environment; benefiting from robust activity.
People mentioned
Donald TrumpJerome PowellMichael BatnickJim CramerAdam ParkerCharlie ScharfJamie DimonScott NationsBenCallieJosh BrownNicoleSeanMattJCJohn