Weekly Market Performance — October 24, 2025

Markets Blog

David Matzko, LPL Research

LPL Research provides its Weekly Market Performance for the week of October 20, 2025. U.S. stocks logged another weekly advance amid thawing trade tensions and a flurry of third quarter earnings. Investors also ended the week on a bright note, posting a solid rally after the delayed release of consumer inflation data for September helped underpin Federal Reserve (Fed) rate cut expectations. In global markets, political developments dominated headlines in Asia over the last five days, while corporate results drew attention in Europe, with both regions posting weekly gains. Fixed income markets ended higher, while commodity markets faced elevated volatility, specifically in oil and precious metals.

Index Performance

U.S. and International Equities

U.S. Equities: Wall Street bulls powered major averages higher this week after shaking off mid-week weakness. Broad upside was credited to easing tariff headline volatility as U.S.-China tensions thawed late in the week after the White House confirmed next Thursday’s meeting between Presidents Trump and Xi — overshadowing Wednesday reports that the White House is mulling restrictions on a variety of software-related exports to China. Plus, markets extended gains with a relief rally on Friday following the first major economic data print of the month. After a delayed release, the September core Consumer Price Index (CPI) remained subdued, rising a tick less than expectations and prior readings, reinforcing hopes for a rate cut at next week’s Federal Open Market Committee (FOMC) meeting.

Earnings season also picked up steam, highlighted by the first Magnificent Seven report, with takeaways arriving broadly mixed. Tesla (TSLA) shares ended the week slightly higher, paring a drop after the electric vehicle maker failed to meet Wall Street’s earnings and profit expectations — although investors did note record sales and strong cash flow figures. Netflix (NFLX) shares dropped after falling short of Wall Street forecasts, and shares of Intel Corp. (INTC) jumped after offering upbeat revenue forecasts and cruising past earnings estimates. Ford (F) offered a better-than-feared outlook, and IBM (IBM) shares dropped on slowing cloud software revenue growth, before reversing gains to end the week higher. Among other highlights, Texas Instruments (TXN) offered an underwhelming fourth quarter outlook, while Hilton Worldwide (HLT) and Boston Scientific (BSX) delivered better-than-expected results.

International Equities: European stocks traded higher as earnings season ramped across the region. A strong batch of financial services earnings powered the industry group to weekly outperformance, trailing only the energy sector, which led the pan-European STOXX 600 Index on a surge in crude oil prices after the U.S. sanctioned multiple major Russian oil companies. France’s CAC 40 Index scored its first record high since May 2024, as strong corporate results overshadowed political and credit jitters after S&P Global downgraded the country’s credit rating from AA- to A+ last Friday, citing political instability and heightened uncertainty around public finances. Meanwhile, in the U.K., macro data lifted stocks after both core and headline consumer inflation surprised to the downside for September, leading investors to fully price in a February rate cut from the Bank of England (BOE).

Equity markets across the Asia-Pacific region also advanced over the last five days, with the upside broadly credited to thawing U.S. trade tensions. Japan dominated early week headlines as investors snapped up shares after pro-growth and pro-stimulus lawmaker Sanae Takaichi sealed a new coalition deal and won the vote to become Japan’s next Prime Minister. Political developments were also in focus across greater China as the annual Fourth Plenum meeting kicked off in Beijing. Investors cheered remarks that the economy is on track for its expansion target and the release of the nation’s five-year plan, which featured technology self-reliance and additional consumer support. South Korea led gains, garnering support from tech strength and growing confidence that a U.S. trade deal is around the corner.

Fixed Income, Currency, and Commodity Markets

Fixed Income: Core bonds, measured by the Bloomberg Aggregate Index, traded higher this week. U.S. Treasury yields ended lower this week, extending a drop in yields since the beginning of the government shutdown. Concerns around large budget deficits, rising debt levels, persistent inflation, and risks to Fed independence remain unresolved. However, over the past month, both growth and inflation expectations have fallen, likely due to the lack of hard data conflicting with the consensus expectations that the economy is softening. Moreover, the Treasury supply and demand dynamics have improved (marginally) with tariff revenue becoming more reliable, along with the prospects of the Fed ending its balance sheet runoff earlier than expected. As we’ve noted, Treasury yields are primarily driven by growth and inflation expectations, so when economic data weakens, yields tend to follow. That said, the recent drop in yields has priced in a fed funds rate below 3% in 2026, which absent further signs of economic softening, we could be at peak dovishness for rate cut expectations.

Commodities and Currencies: The broader commodities complex traded higher over the last five days. After dropping near $56 per barrel Monday, West Texas Intermediate (WTI) crude prices led the charge across major commodity groups this week. Crude prices surged in response to Washington sanctioning state-run Russian oil companies in another push to pressure the country into a resolution for the war in Ukraine. Increased prospects of Russian crude production sent prices higher as the European Union also ramped up Russian energy and infrastructure sanctions. On the other side of the coin, cracks in gold’s torrid rally began to emerge with the yellow metal plunging on Tuesday as traders finally reacted to overheated technicals, while haven demand ebbed as trade tensions cooled. Its largest drop in years snapped gold’s nine-week win streak, and silver followed suit with a 6.5% drop. In currencies, the dollar strengthened moderately against its peers with some assistance from weakness from the yen, euro, and pound.

Economic Weekly Roundup

Housing Inflation is Cooling Amid Lower Immigration. September data indicated consumer prices rose 0.3% from the prior month, pushing the annual pace of headline inflation up to 3%. Annual inflation should drop below 3% in the coming months as the monthly pace has decelerated. Core prices rose 0.2% from last month after rising 0.3% in each of the two preceding months. Housing prices are decelerating and should slow further amid the growing supply of multifamily housing and the shrinking demand from lower immigration. Note that September CPI data collection was completed before the lapse in appropriations, so the summary calculations are statistically sound.

Tariffs were likely the culprit for rising apparel prices in September. We learned from the Fed’s Beige Book that some firms facing tariff-induced cost pressures kept their selling prices largely unchanged to preserve market share and in response to pushback from price-sensitive clients. Inflation metrics will likely improve by December, setting the Fed up to continue easing throughout 2026.

The Week Ahead

The following economic data is slated for the week ahead:

• Monday: Durable Goods Orders (Sep preliminary), Capital Goods Orders and Shipments (Sep preliminary), Dallas Fed Manufacturing Activity (Oct)

• Tuesday: FHFA House Price Index (Aug), S&P Case-Shiller National and 20-City Home Price Indexes (Aug), Richmond Fed Manufacturing Index (Oct), Conference Board Consumer Confidence report (Oct), Dallas Fed Services Activity (Oct)

• Wednesday: MBA Mortgage Applications (Oct 24), Wholesale Inventories (Sep preliminary), Advance Good Trade Balance (Sep), Retail Inventories (Sep), Pending Home Sales (Sep), FOMC Rate Decision (Oct 29)

• Thursday: Initial Jobless Claims (Oct 25), Continuing Jobless Claims (Oct 18), GDP Annualized (3Q first reading), Personal Consumption (3Q first reading), Core PCE Price Index (3Q first reading)

• Friday: Personal Income (Sep), Personal Spending (Sep), Real Personal Spending (Sep), Headline and Core PCE Price Index (Sep), Employment Cost Index (3Q), MNI Chicago PMI (Oct)

IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors. To determine which investment(s) may be appropriate for you, please consult your financial professional prior to investing.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk.

Indexes are unmanaged and cannot be invested into directly. Index performance is not indicative of the performance of any investment and does not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

This material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

Unless otherwise stated LPL Financial and the third party persons and firms mentioned are not affiliates of each other and make no representation with respect to each other. Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.

Asset Class Disclosures –

International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.

Bonds are subject to market and interest rate risk if sold prior to maturity.

Municipal bonds are subject and market and interest rate risk and potentially capital gains tax if sold prior to maturity. Interest income may be subject to the alternative minimum tax. Municipal bonds are federally tax-free but other state and local taxes may apply.

Preferred stock dividends are paid at the discretion of the issuing company. Preferred stocks are subject to interest rate and credit risk. They may be subject to a call features.

Alternative investments may not be suitable for all investors and involve special risks such as leveraging the investment, potential adverse market forces, regulatory changes and potentially illiquidity. The strategies employed in the management of alternative investments may accelerate the velocity of potential losses.

Mortgage backed securities are subject to credit, default, prepayment, extension, market and interest rate risk.

High yield/junk bonds (grade BB or below) are below investment grade securities, and are subject to higher interest rate, credit, and liquidity risks than those graded BBB and above. They generally should be part of a diversified portfolio for sophisticated investors.

Precious metal investing involves greater fluctuation and potential for losses.

The fast price swings of commodities will result in significant volatility in an investor's holdings.

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