Weekly Buzz: Strong earnings, weak close – what spooked markets?

Markets opened strong on Thursday after Nvidia reported quarterly earnings that sailed past Wall Street’s expectations. By the end of the trading day, however, investor sentiment had reversed: the Nasdaq closed down 2.2%, while the S&P 500 dropped 1.6%.

Chief among concerns were dimming prospects for another US interest rate cut before the year is out. The US added 119,000 jobs in September – more than double expectations and rebounding from a loss of 4,000 jobs in August. On the other hand, unemployment ticked up to 4.4% from 4.3%. These mixed signals leave the Federal Reserve in a difficult position ahead of its December meeting. Strong job creation argues against rate cuts, while rising unemployment suggests the labour market needs support.

Meanwhile, questions about AI valuations continue to surface. Despite Nvidia's stellar results, investors are reassessing whether current prices reflect sustainable growth or an overextension. It’s important to note, however, that today's market leaders are better supported by real earnings and cash flow – a stark contrast to the speculation-driven bubble of the late 1990s and the dot-com boom.

For long-term investors, reversals like Thursday's highlight why diversification matters. When one market stumbles, a portfolio that’s invested across regions and asset classes provides stability. Rather than trying to avoid volatility altogether, it’s better to build a portfolio that can handle it – staying invested through the market’s ups and downs remains the more reliable path to long-term returns.

(If you’re looking for a portfolio that’s built with diversification in mind, check out General Investing.)

Investor’s Corner: Lessons from Buffett's final shareholder letter

Warren Buffett just released his final letter to Berkshire Hathaway shareholders. He's stepping down after 60 years at the helm, handing the reins to Greg Abel. Here are his takeaways from six decades of watching markets rise, fall, and rise again.

• Volatility is normal

Buffett reminds shareholders that Berkshire's stock price has fallen roughly 50% three times in the past. Even one of the most successful firms in history has experienced brutal drawdowns. His advice? Don't panic. Temporary drops don't matter when you're staying invested for the long term. Short-term volatility can feel scary, but measured across decades, it becomes insignificant.

• Learn and move forward

Buffett admits to major mistakes during his career in his letter. His message is straightforward: don't dwell on past errors – learn from them and move on. The investors who build wealth over decades aren't the ones who avoid all mistakes, they're the ones who analyse what went wrong, adjust their long-term process, and move forward.

• Define success beyond returns

Greatness doesn't come from accumulating money, publicity, or power, Buffett writes. It comes from helping others in thousands of small ways. Kindness costs nothing but is priceless. It’s an important reminder that portfolio returns are a measure, not the goal. The real question is whether your wealth enables the life you want and the impact you hope to make.

What’s the takeaway here?

Buffett's final shareholder letter reads less like a corporate update and more like a reflection on what actually matters in investing: expect volatility but stay the course, learn from mistakes without dwelling on them, and remember why you're building wealth in the first place.

Coming from someone who built one of the most successful track records in investing history, these lessons carry weight. Markets will keep moving and strategies will evolve, but the fundamentals of patient, disciplined investing remain unchanged.