U.S. stock markets closed lower for the third consecutive session on Thursday, September 25, 2025. This downturn occurred as investors processed various economic indicators and anticipated crucial inflation data scheduled for release on Friday. Major indexes, including the Nasdaq, S&P 500, and Dow Jones Industrial Average, all recorded losses.
Key Takeaways
- Major U.S. stock indexes fell for a third straight day on Thursday.
- The decline happened ahead of Friday's Personal Consumption Expenditures (PCE) inflation report.
- Intel and IBM shares surged, while CarMax plunged 20% after missing estimates.
- Economic data showed stronger-than-expected GDP growth and lower jobless claims.
- Bitcoin experienced a significant drop, falling 3.5% to below $110,000.
Market Performance Overview
The tech-heavy Nasdaq Composite index declined by 0.5%. The benchmark S&P 500 also fell by 0.5%. The blue-chip Dow Jones Industrial Average saw a 0.4% decrease. These losses mark a shift after all three indexes had reached three consecutive record highs through Monday.
Investors evaluated several key economic reports throughout the day. These included the final revision of second-quarter GDP, weekly jobless claims, and durable goods orders. The 10-year Treasury yield also saw an increase.
Market Snapshot
- Nasdaq: Down 0.5%
- S&P 500: Down 0.5%
- Dow Jones Industrial Average: Down 0.4%
- 10-year Treasury Yield: Rose to 4.18% from 4.15%
Key Economic Indicators
The U.S. economy's second-quarter GDP growth rate was revised higher. It now stands at an annual rate of 3.8%, up from a previous estimate of 3.3%. This indicates stronger economic resilience than initially thought. Consumer spending was a primary driver of this upward revision, increasing at a 2.5% annual rate.
Weekly jobless claims also decreased, falling to 218,000 from 232,000 the week prior. Monthly durable goods orders rebounded, suggesting a pickup in manufacturing activity. Existing home sales for August remained largely flat.
Inflation Focus
Friday's release of the August Personal Consumption Expenditures (PCE) index is highly anticipated. The PCE index is the Federal Reserve's preferred measure of inflation. Economists surveyed by Dow Jones Newswires and The Wall Street Journal expect a 2.7% annual rate for headline PCE, up from 2.6% in July. Core PCE, excluding volatile food and energy, is projected to remain at 2.9%.
A higher-than-expected inflation reading could influence the Federal Reserve's decision on interest rates. The Fed is widely expected to cut rates at its next meeting in October. However, strong economic data and persistent inflation could lead to rates remaining unchanged.
Sector and Company Performance
Despite the broader market decline, some individual stocks saw significant gains. Intel (INTC) shares surged approximately 9%, leading both the S&P 500 and Nasdaq. This follows reports that the chipmaker discussed Apple (AAPL) acquiring a stake. Intel shares had already jumped over 6% on Wednesday.
IBM (IBM) shares also performed strongly, rising 5%. This gain came after HSBC reported a successful trial using IBM's quantum computers for algorithmic bond trading. HSBC stated that incorporating IBM's quantum computing improved prediction accuracy by 34%.
"HSBC said that it had conducted a successful bond trading trial using quantum computers from International Business Machines (IBM) to optimize market predictions."
Notable Decliners
- CarMax (KMX): Plunged 20%, making it the worst-performing stock in the S&P 500. The used-car retailer reported second-quarter results that significantly missed analyst estimates.
- Oracle (ORCL): Shares fell 5.6% for their third consecutive day of declines. Rothschild Redburn initiated coverage with a "sell" rating, citing an overly optimistic outlook on Oracle's contracted cloud revenue.
- Tesla (TSLA): Stock ended down more than 4%.
- Micron Technology (MU): Shares dropped 3%, adding to a nearly 3% decline from the previous day, despite reporting record quarterly sales.
- Amazon (AMZN): Shares slipped almost 1% after agreeing to pay $2.5 billion to settle an FTC lawsuit regarding allegedly deceptive subscription practices for Prime memberships.
- Bitcoin: The largest cryptocurrency dropped 3.5%, falling below $110,000. Crypto-tied stocks like MARA Holdings (MARA) and Strategy (MSTR) were down 9% and 7%, respectively.
Other Market and Business News
Starbucks (SBUX) shares slipped 0.5% after the company announced plans to lay off 900 corporate employees and close underperforming stores as part of its turnaround strategy. CEO Brian Niccol stated the company would end its fiscal year with 1% fewer stores in the U.S. and Canada.
Kodiak AI, a new company focused on AI-powered self-driving trucks, made its market debut. Shares of Kodiak AI fell 10% in its first hours of trading. The company, trading under the symbol "KDK," opened at $8.75.
Opendoor Technologies (OPEN) stock jumped more than 6% after trading giant Jane Street disclosed a 5.9% stake in the online real estate platform. This stake amounts to approximately 44 million shares, valued at about $362 million.
International Developments
Chinese stocks have seen a significant boost this quarter, outperforming the S&P 500. The Shanghai Composite and CSI 300 are up 18% and 20% year-to-date, respectively, compared to 13% for the S&P 500. This is partly driven by improving sentiment around U.S.-China trade talks and confidence in China's AI capabilities.
The U.S. has also launched national security investigations into imports of robotics, industrial machinery, and medical devices under "Section 232" of the Trade Expansion Act. This could lead to new tariffs, particularly targeting China, to boost domestic manufacturing.
Commodities and Currencies
West Texas Intermediate (WTI) crude oil futures saw a slight increase, trading at $65.15 per barrel. This follows a more than 2% surge the previous day. Gold futures were up 0.3% at $3,780, after setting a new record high earlier in the week.
The U.S. dollar index, which measures the dollar against a basket of foreign currencies, rose 0.7% to 98.52. This marks a rebound from its lowest level since early 2022, reached last week.
Federal Reserve Independence Debate
A group of former Federal Reserve chairs and White House officials urged the Supreme Court to protect the central bank's independence. They filed a brief supporting Fed Governor Lisa Cook, aiming to prevent President Donald Trump from firing her. Signatories included Janet Yellen, Ben Bernanke, and Alan Greenspan.
According to the brief, "The Federal Reserve’s independence and the public’s perception of that independence are important for economic performance... Allowing the removal of Governor Lisa D. Cook while the challenge to her removal is pending would threaten that independence."
