Monthly market commentary.
Stocks rally on positive earnings and trade news.
Monthly market commentary: Stocks rally on positive earnings and trade news.
Global equities, as measured by the MSCI ACWI Index, gained ground in October 2025. Investors were encouraged by generally better-thanexpected corporate earnings reports, central bank monetary policy easing, and signs of softening trade tensions between the U.S. and China. Emerging markets outperformed developed markets.
The Far East led the emerging markets during the month due mainly to strength in Korea and Taiwan. Eastern Europe was bolstered by the outperformance of Hungary and Poland. Conversely, Chinese stocks listed on the Hong Kong Stock Exchange recorded negative returns. The Far East also was the strongest performer among the developed markets in October, attributable mainly to a rally in Japan. Additionally, North America benefited from strength in the U.S. market. On the downside, the underperformance of the Asia-Pacific ex Japan region resulted from relative weakness in Australia and Singapore.
Global fixed-income assets, as represented by the Bloomberg Global Aggregate Bond Index, dipped 0.3% (in U.S. dollars) in October. Mortgage backed securities (MBS) led the U.S. fixed-income market, followed by U.S. Treasurys, investment-grade corporate bonds, and high-yield bonds. Treasury yields moved lower across the yield curve, with the exception of the 2-year note, which was unchanged at 3.60%. Yields on 3-, 5-, and 10-year Treasury notes declined by corresponding margins of 0.01%, 0.03%, and 0.05%, ending the month at 3.60%, 3.71%, and 4.11%, respectively. The 10-year to 3-month yield curve widened by 8 basis points (0.08%) to +0.22% as of October 31.1
Global commodity prices, as measured by the Bloomberg Commodity Index, gained 2.6% in October. The spot prices for West Texas Intermediate (WTI) and Brent crude oil fell 2.2% and 1.9% respectively, over the month due to softer demand and an increase in supply as the Organization of the Oil Exporting Countries (OPEC) ramped up production. Economic uncertainty and expectations of a Federal Reserve interest-rate cut contributed to the 3.2% rise in the gold price to numerous record highs over the month. However, On October 21, the price tumbled 5.7%—its largest one-day decline since 2013—due to some profit-taking following a prolonged rally, as well as U.S. dollar strength. (The gold price typically moves inversely to the U.S. dollar.) The 32.3% surge in the New York Mercantile Exchange (NYMEX) natural gas price for the month was attributable to stronger-than-expected demand for cooling and a significant increase in liquefied natural gas (LNG) exports. The wheat price climbed 5.1% in October due primarily to higher demand from North Africa and the Middle East, as well as continued geopolitical tensions in Ukraine.
U.S. trade policy remained a focal point for global financial markets during the month. In a social media post on October 10, President Donald Trump threatened to cancel a scheduled meeting with China’s President Xi Jinping and impose “a massive increase in tariffs” on Chinese imports, accusing the Chinese government of “becoming very hostile, and sending letters to Countries throughout the World, that they want to impose Export Controls on each and every element of production having to do with Rare Earths [a group of 17 metals that are used in the production of electronics such as smartphones, computer hard drives, and big-screen televisions]…” However, Trump and Xi met in South Korea toward the end of the month and reached a tentative trade deal in which the U.S. agreed to reduce tariffs on imported goods from China from 57% to 47% in exchange for China’s pledge to curb the export of chemicals used to produce fentanyl. Additionally, Xi agreed to a one-year suspension of export controls on rare-earth minerals, and China will end its embargo on soybean imports from the U.S.
The U.S. government shutdown, which began on October 1, was not resolved by the end of the month. The political dispute centers on the demand of the Democrats, who are the minority party in both the House of Representatives and the Senate, for an extension of the enhanced Affordable Care Act (ACA) health insurance subsidies enacted during the COVID-19 pandemic in 2021, and to restore the cuts to the Medicaid program mandated in the One Big Beautiful Bill Act, which Trump signed into law in July.
On the geopolitical front, on October 9, Trump announced that Israel and Hamas had agreed to a ceasefire in the war that began in October 2023. The deal required Hamas to release all of the Israeli hostages held in Gaza. The Israeli government began to withdraw its troops from parts of Gaza the following day. The ceasefire appeared to be jeopardised on October 19, when Israel launched numerous airstrikes on several targets in Gaza and accused Hamas of breaking the truce by attacking its military forces in the Rafah area of southern Gaza. The Israeli military again attacked Hamas in Gaza toward the end of October, claiming that Hamas violated the ceasefire by firing on Israeli troops who were stationed in Israeli-controlled territory in southern Gaza.
1 According to the U.S. Department of the Treasury. As of 31 October 2025.
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