October 16, 2025

Portfolio Changes: None

Stocks Steady and Commodities Surge as World Trade Map is Redrawn

Explorer stocks were mixed this week as Asian stocks struggled amidst increased U.S.-China economic tensions and concern over Chinese economic growth.

Commodities are back but something to keep in mind was mentioned to me by a friend in the energy business: “America is running out of shale oil.” This has big implications for world oil markets and America’s energy mix since if we are running out of the shale oil that can be extracted at about $60/barrel, higher oil and energy prices are around the corner.

Gold stayed on a bull path this week as gold prices set records and gold ETFs continue to attract capital. Propelling prices is a mix of relentless central bank buying, ballooning U.S. debt, the search for safe havens, and a growing distrust of fiat currencies. China’s central bank has been increasing its monthly gold purchases for 11 straight months. Does this represent diversification or an exit strategy?

China is playing hardball with rare earths as it expanded export controls on certain rare earth elements AND its processing technologies. It also will require foreign companies to get export licenses for exporting products that contain even a fraction of Chinese-sourced rare earths. Beijing’s power move reflects that it doesn’t fear being blocked from U.S. consumer markets as much as many in Washington think. The reason is that China’s exports are very diversified, as the chart below (courtesy of Bloomberg) highlights.

The international trade map is being redrawn as 85% of the world’s trade does not touch America. Canada is importing more cars from Mexico than from the U.S., and China is buying soybeans from South American and Argentine growers instead of American farmers. Trade and capital flows are more mobile than many imagined.

Smaller economies like Peru are seeking buyers in Asia, Europe, and Africa. New Zealand, Singapore, Switzerland and the United Arab Emirates (UAE) have formed a partnership to boost trade and investment. European countries are in the process of ratifying a pact with a common market of South American countries with 780 million consumers—a deal 25 years in the making. And in September the EU inked a free trade deal with Indonesia, the largest economy in Southeast Asia with a population of 265 million, after almost a decade of talks.

JPMorgan (JPM) is not only making big profits, it made a big splash this week as it announced it would directly invest $10 billion in companies it deems critical to U.S. economic national security. It also will “facilitate” $1.5 trillion in investments over the next decade. This initiative will focus on four key areas: advanced manufacturing, including minerals, pharma and robotics; defense and aerospace; energy independence; and strategic technologies such as AI, cybersecurity, and quantum computing.

Finally, China is increasingly seen as a clean tech leader as coal use flattens out at a high level and solar and wind power ramp up. In Tibet, they have a solar farm seven times the size of Manhattan with the capacity of 17,000 megawatts of power. This energy costs about 40% less than its coal-fired power.

Explorer Weekly Stock Commentary

Below is a brief update on each Explorer stock. Any changes in ratings will be highlighted. This section is all you need to read each week.

Explorer Disrupter Recommendations – need to watch more closely and have a 20% trailing stop-loss in place.

Agnico Eagle Mines (AEM) shares gained 5.4% this week and the stock is now about 130% up this year. The company now has a profit margin of 30% with only 3% debt to equity. We should expect some sort of price pullback at some point. The company has mining operations in Canada, Mexico and Finland. Buy a Half

Alibaba (BABA) shares were off 8.4% after reporting a 69% fall in year-over-year earnings per share. BABA makes widely used open-source AI systems. Like the United States, the Chinese index is dominated by tech companies, with Tencent, Alibaba and Xiaomi accounting for about 30% of the benchmark. Buy a Half

Baidu (BIDU) shares pulled back 11% along with Chinese stocks but have been performing well this year, hitting a two-year high last week. Baidu’s AI initiatives and autonomous driving arm, Apollo Go, have emerged as key drivers of the company’s long-term growth strategy. The platform has now surpassed 14 million cumulative rides, reflecting triple-digit year-over-year growth. Buy a Half

Banco Santander (SAN) shares pulled back 2.7%. It is the largest bank in Europe and is headed up by the widely respected Ana Botín. There is still upside potential but you may wish to sell some shares to lock in profits. Buy a Half

Coeur Mining (CDE) shares were up 6% this week and have surged 25% in the last month. Earnings estimates are increasing for this stock along with the rise in gold prices, and I suggest taking some partial profits to lock in gains. Hold

Luckin Coffee (LKNCY) shares were down 3.4% this week after gaining 11% last week. China’s coffee drinkers still consume far fewer cups per person each year than consumers in the United States or Japan, leaving plenty of room for growth. The company has come a long way since its founding in 2017, operating about 26,000 stores as of mid-2025. Buy a Half

Newell Brands (NWL) shares were off 4.5% in their first week as an Explorer recommendation. Newell stock presents us with a good value trading at just 80% of book value with a forward price to earnings ratio less then 7 and a dividend yield of 5.3%. The stock is sharply down from its 52-week high of 11.8. Third-quarter earnings will be out October 31. Buy a Half

Sea Limited (SE) shares were down sharply yesterday, justifying our recent profit taking. Part of the pullback is due to weakness in Asian markets this week due to an uptick in economic tensions between the U.S. and China. I’m leaving this a hold. Hold a Half

Explorer Dominator Blue-Chip Recommendations – More Buy and Hold

Alphabet (GOOG) shares were up 2.5% this week as its cloud computing and AI initiatives draw increased attention. In addition, Google is the gateway to the internet for most people in the world outside of China and has a sizable cash stream from its top digital advertising network. Buy a Half

International Business Machines (IBM) shares pulled back 3% this week as the company offers us a stable free cash flow and a recurring revenue model. IBM is a conservative way to invest in AI and quantum technologies, which is projected to grow significantly. Buy a Half

Visa (V) shares were steady this week as the company is seeing a surge in AI-driven traffic to U.S. retail websites, which has increased by more than 4,700% in the last year. The company expects to report its next quarterly earnings on November 4. Buy a Half

Explorer ETF/Fund Positions

CurrencyShares Swiss Franc Trust (FXF) gives you exposure to a high quality country and currency with fiscal discipline, a trade surplus, and very little foreign debt, and a reputation as an asset haven in times of stress. Buy a Half

Grayscale Bitcoin Trust (GBTC) offers investors a way to track very closely to the day-to-day or “spot” movement of bitcoin prices. For aggressive investors comfortable with volatility. Hold

JPMorgan Equity Premium Income ETF (JEPI) offers double-digit yield coming from both option premiums and dividends using a value-focused strategy. Buy a Full

Oberweis Micro-Cap Fund (OBMCX) fund stands out for several reasons. The fund’s sound investment process and strong management team earns it a rare Morningstar Medalist Rating of Gold. Over the past five years it has posted an impressive average annual return of 24%. Buy a Half

ProShares MSCI EAFE Dividend Growers ETF (EFAD) seeks to capture the performance of companies with at least 10 years of consecutive dividend growth. Buy a Half

Sprott Platinum and Palladium ETF (SPPP) offers direct exposure to both platinum and palladium which are selling at a sizable discount to gold offering potential upside appreciation. Buy a Full

Stoxx Europe Total Market Aerospace & Defense (EUAD) tracks an index of top defense contractors including Leonardo, Rheinmetall, and BAE Systems. Buy a Half

Tweedy, Browne Insider and Value ETF (COPY) provides exposure to a combination of value, international, small cap stocks managed by a stellar asset manager. Buy a Half

VanEck Junior Gold Miners ETF (GDXJ) is a basket of junior miners that has 84 positions with the top 10 accounting for 44% of total assets. Half of the stocks are Canadian, 21% Australia, and 7% from South Africa. Buy a Half

WisdomTree Emerging Markets High Dividend Fund (DEM) offers a high dividend yield and some of the highest quality emerging market stocks. Buy a Half

Currently Open

ETFs

Copyright © 2025. All rights reserved. Copying or electronic transmission of this information without permission is a violation of copyright law. For the protection of our subscribers, copyright violations will result in immediate termination of all subscriptions without refund. Disclosures: Cabot Wealth Network exists to serve you, our readers. We derive 100% of our revenue, or close to it, from selling subscriptions to our publications. Neither Cabot Wealth Network nor our employees are compensated in any way by the companies whose stocks we recommend or providers of associated financial services. Employees of Cabot Wealth Network may own some of the stocks recommended by our advisory services. Disclaimer: Sources of information are believed to be reliable but they are not guaranteed to be complete or error-free. Recommendations, opinions or suggestions are given with the understanding that subscribers acting on information assume all risks involved. Buy/Sell Recommendations: are made in regular issues, updates, or alerts by email and on the private subscriber website. Subscribers agree to adhere to all terms and conditions which can be found on CabotWealth.com and are subject to change. Violations will result in termination of all subscriptions without refund in addition to any civil and criminal penalties available under the law.