Market snapshot: another triumph for tech sector

Despite obvious headwinds, tech shares and the stock market more broadly show little sign of giving up this rally. ii's head of markets examines latest developments.

9th October 2025 08:21

by Richard Hunter from interactive investor

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There may be little room for manoeuvre on earnings misses in the imminent quarterly reporting season given current valuation levels, but for the moment the technology sector continues to ride roughshod over the bears, with the S&P500 and Nasdaq roaring to new closing record highs.

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At present, the theme is playing out that bull markets must climb a wall of worry. This has been evidenced not only by the flight to haven assets such as gold which is at record highs, but also by the increasing questions of valuation, particularly in regard to the AI trade.

Oracle Corp (NYSE:ORCL) shares weakened earlier in the week as speculation emerged that margins on its cloud business were far lighter than those currently being pencilled in by analysts. Nor is there much room for any earnings disappointments in the upcoming results period. One bank has estimated earnings growth of 20.9% in the tech sector for the third quarter, up from 15.9% in the second, with actual earnings expected to grow by 8% and revenues by 6.3% in an unusual ramping up of estimates affecting some 80% of stocks in the sector.

However, the current signals are suggesting that this particular rally is showing few signs of running out of steam. NVIDIA Corp (NASDAQ:NVDA) shares added 2% following some upbeat thoughts on the future of AI and its associated financial benefits, while Advanced Micro Devices Inc (NASDAQ:AMD) built on its run to jump another 11%, with Dell Technologies Inc Ordinary Shares - Class C (NYSE:DELL) not far behind with a further gain of 9% after its own bullish update on prospects.

A dearth of economic releases due to the government shutdown has left investors to focus elsewhere, although the release of the Federal Reserve’s latest minutes did little to move the dial, with some division among its members on the future path of interest rates after the highly anticipated cut to come this month.

In the meantime, Delta Air Lines Inc (NYSE:DAL) and PepsiCo Inc (NASDAQ:PEP) kick off a Q3 season today which is expected to show overall earnings growth of 7.9% year on year for S&P500 constituents, in what would represent a ninth consecutive quarter of earnings growth. The new record closing highs take the gains so far this year for the S&P500 and Nasdaq to 14.8% and 19.3% respectively, with the more traditional Dow Jones posting a 9.5% advance.

The FTSE100 declined from its own record closing high at the open, weighed down by the usual Thursday raft of stocks being marked ex-dividend, today in the form of Tesco (LSE:TSCO), Kingfisher (LSE:KGF), Barratt Redrow (LSE:BTRW) and WPP (LSE:WPP).

Lloyds Banking Group (LSE:LLOY) shares eased by more than 2% after the initial relief of the motor finance consultation was erased by the group issuing a statement that its provision for the fines may be “material”. More positively, the focus on copper lifted the likes of Antofagasta (LSE:ANTO) and Anglo American (LSE:AAL), while Burberry Group (LSE:BRBY) shares popped following a broker upgrade.

Despite any weakness in opening exchanges, the premier index has posted an impressive gain of 16.5% in the year to date, quite apart from the additional boost across its constituents of an average 3.1% dividend yield. With an increasing appetite for haven destinations in evidence and with a still heavily discounted valuation to many of its global peers, the FTSE100 for many continues to represent compelling value.

These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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