Monday, September 22, 2025
We’re in September, and talk about a disconnect. Why is the market near or making new all-time highs with all these negative things swirling?
Well, one reason could be American companies are buying their own stocks at a record pace. These firms are boosting their balance sheets and fueling the long-running U.S. stock rally.
As of this writing, U.S. companies have announced $983 billion worth of stock buybacks so far this year, the most on record since 1982, according to Birinyi Associates. In total, companies are projected to purchase more than $1.1 trillion worth of their own stock in 2025 (they’re already at $1 trillion). That would be an all-time high.
Strong earnings growth and tax cuts have helped fill corporate treasuries while lifting stocks out of April lows and on to new records for the S&P 500 and Nasdaq Composite. At the same time, trade confusion has stalled corporate investment plans, making buybacks seemingly a better use of income and cash (to “maximize shareholder returns”).
This is controversial to some. Skeptics say repurchases prop up the stock market and stretch valuations even more.
It’s seeping into stock analysis too. Analysts worry that companies favoring buybacks over long-term commitments like building factories or paying dividends suggests President Trump’s trade war stands to hurt growth over time.
So, as negative factors keep appearing, the market keeps setting records. Perhaps we have corporate buybacks to thank for that, at least in part.