We just wrapped up our October market session, where we dove into what’s been powering global equity moves, which risks to watch, and where opportunity may lie in a stretched market. Here’s a distilled version of what Li Chye, our Senior Financial Market Analyst shared (and what you should keep in mind as you plan your next moves).

⚡ Highlights from September & the U.S. Shutdown

• U.S.–China trade talks still on the front burner. Recent developments include renewed discussion over TikTok’s U.S. operations, agricultural purchases (especially soybeans), and export controls. These talks remain fragile and under heavy scrutiny.
• U.S. government shutdown. Early October saw a partial shutdown, disrupting data flow, federal worker pay, and adding macro uncertainty. While markets have shown resilience so far, prolonged shutdowns tend to raise stress.
• Sectoral divide. The shutdown disproportionately affects lower-income-related consumer sectors and staples. But high-capex, AI-related tech sectors are relatively insulated — they continue receiving attention and allocation from institutional players.
• Earnings season looming. October brings a wave of tech and large-cap reporting. Markets may see a pre-earnings lift — but with valuations already high, that lift could be tenuous.
• Strain on market breadth. Even as indexes hit all-time highs, many sectors are stretched. Momentum is concentrated in select themes — meaning broad participation is weakening.

Watch the playback:

🔍 Risks & Structural Themes to Watch

1. Valuation stretch — With many tech names extended, the margin for error tightens.
2. Data blackout — The shutdown has delayed key economic releases, creating uncertainty for the Fed and market participants.
3. Tariffs & export controls — Ongoing trade policy shifts, especially in AI chips and semiconductors, remain wildcards.
4. Sector rotation pressure — As tech weakens, look for capital shifting into interest-sensitive areas, health care, or more defensive plays.
5. Event risk from earnings — Big names missing expectations could trigger sharper pullbacks than usual in this environment.

🚀 Where Opportunity Still Resides

• AI infrastructure & semiconductors. With companies still building capacity, the supply chain — from chips to memory to data center hardware — remains in focus.
• Memory & storage. As AI shifts more toward inference workloads, demand for fast, high-capacity memory continues to rise.
• Healthcare & fintech. Regulatory moves, drug pricing deals, and blockchain/fintech evolution offer interesting entry points.
• Rate-sensitive sectors. As rate cuts unfold, homebuilders, small caps, and financials could benefit more than many expect.

🎯 Takeaways for Investors & Traders

• If you’re long-term, patience is key. Don’t chase valuations that lack foundation, wait for meaningful pullbacks.
• If you’re a swing/intraday trader, this era is still tradable, especially in high-conviction sectors. But risk management must be tighter than ever.
• Always have a framework. You can’t react to every headline. Use macro + industry + valuation lens before entering or exiting.
• Plan for rotation. Be ready to shift when trend leaders show fatigue.