U.S. markets moved higher as investors reacted to upbeat third-quarter earnings from major technology companies. Strong performance in big tech helped sustain the broader rally despite mixed results across sectors and uncertainty surrounding future rate policy.
BNN Bloomberg spoke with David G. Dietze, chief investment strategist at Dietze Wealth Management Group, who said investor enthusiasm for artificial intelligence continues to shape market momentum. He noted that the recent gains have been concentrated in a few large-cap names, signalling the importance of diversification as the rally matures.
Key Takeaways
- Meta shares fell after earnings amid investor concern over rising AI infrastructure spending and a one-time tax hit.
- Microsoft posted solid results but its rising capital expenditures and softer revenue forecast weighed on sentiment.
- Alphabet outperformed on strong earnings and disciplined costs, with investors upbeat on its AI and cloud growth.
- Markets remain supported by easing trade tensions and lower rates, though risks include high valuations and policy uncertainty.
- Dietze recommends shifting toward energy, healthcare and consumer staples for more balanced exposure and dividend stability.
Read the full transcript below:
ANDREW: Investors are looking over a slew of earnings this morning, and Meta is not delighting investors. Microsoft is also seeing some pressure, but Alphabet is jumping on a beat, especially in its cloud division. We’ve got results from Restaurant Brands and AltaGas as well. Let’s get more from David Dietze, chief investment strategist at Dietze Wealth Management Group.
David, thanks very much indeed for joining us. This Meta story is just incredible, isn’t it? They sell this addictive product, including Instagram. I find it so hard to put it down. They just get inside your head. But they’re not sitting around. They’re spending so heavily.
DAVID: You’re absolutely right, Andy. Their results came in terrific — big beats on both the top and bottom line. There was a one-time tax hit, but investors should consider that as just that — one time. I think what’s spooking investors a little bit this morning is their plan to double down on AI infrastructure spending. The problem is that we just don’t know what those returns will bring.
We’ve seen in the past that Mr. Zuckerberg isn’t shy about placing big bets in unproven areas. We saw that a few years ago when he invested heavily in the metaverse, which didn’t turn out to be very profitable and had to be scaled back. Now we’re wondering whether this enhanced AI spending could end up being a similar situation.
ANDREW: That’s interesting. Thanks for reminding us he was going gangbusters on the virtual reality side. I remember we even had a version of him in the dream world, as at least one science fiction writer called it. But investors seem concerned he’s overdoing it again. What about Microsoft? What jumped out for you, David?
DAVID: Microsoft is kind of in the same situation. They’ve produced stellar results. Their partnership with OpenAI is going gangbusters, but they’re also ramping up spending. In the same way that investors are being cautious with Meta, they’re now being cautious with Microsoft. Both companies have had stellar returns over the last three years, and I think some investors are saying, “Show us the money.” There’s no real need to keep doubling down when we’re not yet seeing those monetary returns.
ANDREW: And you reckon Meta is relatively cheap and a buy — same with Microsoft?
DAVID: Yes. First of all, I love the management of both companies. Mr. Zuckerberg is fully engaged, a premier leader in tech. What I like is that if something isn’t working, as we saw with the metaverse, he’ll pivot and cut spending to keep stakeholders happy. And over at Microsoft, Mr. Nadella is also a proven leader. They’ve got strong cash flows coming in from their desktop leadership and other areas. I think he’ll continue to balance AI infrastructure spending with keeping shareholders satisfied.
ANDREW: What about the big E — Alphabet, or the search giant Google? You see potential there, too?
DAVID: Absolutely. They have tremendous business momentum. The concern was that they were losing share and that their search business would become vulnerable to new AI research capabilities. But they’ve upped their game, blending AI with search in a very sensible way. They’re also taking a measured approach to further AI investments, and investors are rewarding them for that today.
ANDREW: One Canadian stock you’re watching is AltaGas, a big player in energy processing and transport. You have a hold on that stock — you wouldn’t be putting fresh money to work right now?
DAVID: It’s a great company, with a strong midstream business combined with a utility business, so it’s an interesting combination. They just reported earnings this morning, but unfortunately, results were a little shy of last quarter’s. They saw solid double-digit growth in midstream, but other areas came up short. I really like the company, but since it’s trading in the middle of its range, I don’t see a big catalyst to put new money to work today.
ANDREW: Thank you very much, David. Always appreciate hearing from you.
DAVID: Thank you, Andy.
ANDREW: David Dietze, chief investment strategist at Dietze Wealth Management Group.
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This BNN Bloomberg summary and transcript of the Oct. 30, 2025 interview with David Dietze are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
