“Consumer discretionary, especially at the low end, has also been a place of concern as those lower-income consumers are really stretched in terms of their incremental dollar that they’re earning. So, if I think about the broader landscape, it’s kind of a tale of 2 cities. Anything connected to AI has really been swept up by a lot of enthusiasm and anything that has really been touched by tariffs or is potentially seeing consumer tightening, that’s a place where stocks have been hurt.”

Each quarter, Julie Biel, CFA, Chief Market Strategist offers her perspective on the underlying forces driving the market.  In her latest episode, Julie recaps key developments from 3Q 2025, including:

• A sharp rally in small-cap stocks, driven by lower interest rates and investor appetite for lower-quality names
• Broader participation in the AI ecosystem, with industrial and energy companies benefiting from data center infrastructure demand
• Resilient consumer spending, though increasingly concentrated among high-income households—raising questions about the sustainability of demand breadth
• Evolving market valuations heading into 2026, highlighting areas of opportunity and caution across both large- and small-cap segments

For more insights, read our 3Q 2025 Commentary or subscribe to Kaynecast where we provide the latest updates from the KAR Investment Team on our investment strategies.

Kaynecast is available on Apple Podcasts and Spotify.