Stocks finished sharply higher yesterday with all of the major indexes up by more than 1%. The small-cap Russell 2000 led the way with an outsized gain of 1.95%, followed by the Nasdaq with 1.37%.

Apple, which was up 3.94% yesterday, was cited as one of the drivers in Monday's rally. They make up roughly 6% of the S&P 500, and approximately 11% of the Nasdaq 100.

Reports that the iPhone 17 outsold the iPhone 16 in the first 10 days in both the U.S. and China energized investors. As did an upgrade from Loop Capital. They went on to say that Apple is "now at the front end" of their "long anticipated adoption cycle."

They also noted excitement over Apple's plans for an integrated AIPhone.

Apple has lagged this year on what some believe was a slow rollout of AI. But that is expected to change in the near offing. And it's expected to be a big catalyst in customers upgrading their products.

They report earnings next week on Thursday, 10/30, after the close.

In the meantime, we'll get a parade of marquee earnings this week, starting with Netflix and Texas Instruments today.

In other news, it was reported that websites using Amazon Web Services (AWS) experienced outages. Amazon says service was restored in about 2 hours. Amazon's stock was largely unaffected. In fact, it gained 1.61% on the day.

Not much on the economic report docket today.

The other week, the markets were roiled after President Xi of China proposed export restrictions on rare earths, and President Trump responded by proposing 100% additional tariffs on China. Tensions have eased regarding rare earths, ahead of the planned meeting with the two leaders in South Korea next week at the APEC summit.

Nonetheless, the threat was a wake-up call that China controls 60% of rare earth mining and production, and 90% of rare earth processing.

Rare earths are essential elements in many of today's modern technologies and industries. This includes smartphones, flat-screen TVs, EV batteries, MRI scanners, semiconductors, and so much more, not to mention military weapons and defense systems. Given its importance to the economy, technological innovation, and national defense, this is a very important subject.

China's move was largely seen as an effort to gain some leverage ahead of their talks. Especially given the U.S. export controls on semiconductor chips to China.

While President Trump and Treasury Secretary Scott Bessent are optimistic that a deal will be worked out on trade, including rare earths, the U.S. is taking steps to increase their access to rare earths, thus reducing their dependency on China.

That being said, the White House touted yesterday's $8.5 billion rare earths deal with Australia.

Today marks day 21 of the government shutdown, tying for the second longest shutdown with the 21-day closure back in 1995/1996. Tomorrow, assuming it goes on for at least one more day, will make it the standalone number two.

The longest shutdown is 35 days back in 2018/2109.

But there's hope that record will remain. Kevin Hassett, the President's top economic advisor, said he believes the shutdown is "likely to end sometime this week."

The market has been doing just fine during the shutdown, however, with the S&P up 0.70%. The average gain for the S&P during past government shutdowns since 1980 has been 1.69%.

But it will still be nice when it's over.

See you tomorrow,