October 19, 2025
Volume 12, Issue 43
Weekly Recap
Domestic equities traded higher last week, rebounding from a sharp sell-off on the prior Friday that saw the S&P 500 register its worst day since April. It was a volatile week for stocks that started on a positive note after representatives from the U.S. and China appeared to walk back some of the prior week’s escalation of trade tensions. Some dovish comments from Federal Reserve officials and several deal announcements related to artificial intelligence also appeared to support equity markets early in the week. Earnings season also began in earnest on Tuesday, with several big banks reporting third-quarter results. JPMorgan Chase, Citigroup, and Wells Fargo all reported better-than-expected results for the quarter. In total, about 12 percent of S&P 500 companies had reported as of Friday morning. Of those, 86 percent announced earnings that beat consensus estimates, according to data from FactSet, which seemed to help buoy sentiment during the week.
Thursday saw stocks give back some gains after a pair of regional banks disclosed problems with loans involving allegations of fraud. This, following the recent bankruptcies of a subprime auto lender and an auto parts company, appeared to fuel emerging concerns about rising risks in the credit market and the broader health of the regional banking industry. It also helped push the CBOE Volatility Index – which measures expected stock market volatility over the next 30 days – to the highest level since April on Thursday.
Elsewhere, Federal Reserve Chair Jerome Powell seemed to indicate that the central bank remains on track to cut short-term interest rates again this year. Speaking at an event Tuesday, Powell echoed comments he made following the Fed’s mid-September meeting, noting that the “downside risks to employment” have shifted the balance of risks in the economy, leading investors to believe that the central bank is likely to remain on the path to easing borrowing costs at its next meeting, despite inflation remaining above target. Other Fed officials, including Christopher Waller and Stephen Miran, also made comments supporting additional rate cuts this year.
On Wednesday, the Fed also released its Beige Book, a report published eight times per year, in which each of the Fed’s 12 regional banks gathers information and data about economic conditions in its district. The report noted that economic activity was little changed since the previous report with a generally mixed picture across districts, as employment levels held steady and wages rose, but consumer spending “inched down,” “prices rose further,” and “more employers reported lowering head counts through layoffs and attrition.”
U.S. Treasuries generated positive returns last week as yields across most maturities declined, with the benchmark 10-year U.S. Treasury note yield hitting its lowest level since October 2024 on Thursday. Banking concerns, the ongoing federal government shutdown, and comments from Fed officials helped drive yields lower during the week.
Market Monitor
A full listing of market performance data is available here.
DQYDJ.com (“Don’t Quit Your Day Job”) offers helpful investment calculators here, including one that shows total returns for individual stocks. Koyfin.com provides reams of data on individual stocks, including the ability to track total return — and just about anything else — over time.
In the News
The IMF released its latest 2025 World Economic Outlook report on Tuesday, in which it projects global growth to slow down from 3.3 percent in 2024 to 3.2 percent in 2025 and 3.1 percent in 2026, along with slowing growth for the United States, China, and the EU. The U.S. economy is expected to cool to 2 percent growth this year, down from 2.8 percent in 2024. IMF Chief Economist Pierre-Olivier Gourinchas told Fox Business that the organization is not forecasting a U.S. recession at this time, though he noted the odds of a downturn have risen from about 25 percent to 37 percent. The IMF cites uncertainty over trade policy and supply chains, rising protectionism, labor supply shocks, fiscal vulnerabilities, potential financial market corrections, and the erosion of institutions as key reasons for a slowdown in global growth, though it also noted its global projections had been revised upward since its April report. Some analysts, however, caution that the IMF’s forecasts should be viewed with care, noting its past difficulty in predicting major economic events such as the 2008 financial crisis and the 2021 inflation surge.
In a Tuesday speech, Federal Reserve Chair Jerome Powell said that a recent hiring slowdown poses a risk to economic growth, a signal that the Fed will continue to cut interest rates.
An extended government shutdown is raising the prospect that Federal Reserve officials will make their next interest-rate decision without key economic data that could reconcile a debate over how far and fast to cut rates.
Consider how far the bull market has come since its unheralded birth a little over three years ago during the Biden administration. The S&P 500 at that point had fallen more than 25 percent amid soaring pandemic-era inflation and rising interest rates. But on October 12, 2022, the U.S. stock market turned. From that date through October 8 of this year, the S&P 500 gained nearly 88 percent. Including dividends, according to FactSet, a financial data firm, investments in low-cost S&P 500 index funds returned more than 97 percent over that period.
The White House officially imposed new tariffs at midnight Tuesday, with additional rates of 10 percent to 50 percent on goods including lumber, cabinets, and furniture.
JPMorgan Chase CEO Jamie Dimon wrote an op-ed in The Wall Street Journal, announcing that the bank plans to allocate $1.5 trillion over 10 years “to facilitate, finance and invest in industries crucial to national security and economic resilience, from critical medications and minerals to military equipment and semiconductors.”
Inflation in the grocery aisle is picking up, and stinging consumers.
This market is nothing like the dot-com bubble.
Are 15 years of European underperformance coming to an end?
As of 2025, 17.7 percent of households in the United States are millionaires, possessing assets in excess of $1 million, up from 12.3 percent in 2017. A lot of those millionaires are cash-poor, all things considered. Their actual wealth is locked away in housing, qualified retirement accounts, and businesses. For instance, of the 12 million households with between $1 million and $2 million in assets, only 17 percent of their wealth is in liquid assets, with the rest locked away primarily in housing (39 percent) and retirement (33 percent). Only when you get to the 3.5 million households with north of $5 million do you see the kind of walking-around money you’d associate with the upper echelon of wealth. Even then, only 24 percent of their assets are liquid. Not to mention, the trappings of wealth are getting pricier too. A basket of luxury goods — a four-bedroom house in the suburbs, two luxury sedans, a boat, and a cottage in the country — that cost $1.45 million in 2017 would cost $2.12 million today.
Charts of the Week
I found the following articles to be of note. Some may be of interest only to advisors while others are aimed more broadly. You may hit paywalls below; many can be overcome here.
- Tariffs, Technology, and Transition (PIMCO)
- How Private Companies Are Reshaping Public Markets (Morningstar)
- Adapting to the Terrain (Goldman Sachs)
This is the best thing I’ve read recently. The craziest. The coolest. The most important. The most interesting. The most powerful. Peak TV is over. Has social media “jumped the shark”? Digital platforms have gotten worse (one; two). RIP, Sister Jean; D’Angelo; Diane Keaton. Sleep. Wildlife. Classic.
PepsiCo announced on Monday that it would be releasing a protein-packed line of Doritos. You might consider dipping them in high-protein hot sauce, before washing them down with a non-alcoholic protein beer or the TikTok-viral Costco protein water.
“The public is often right during the trends, but wrong at both ends.”
~ Humphrey B. Neill
Securities and advisory services are offered through Madison Avenue Securities, LLC, a member of FINRA and SIPC, a registered investment advisor. This report provides general information only and is based upon current public information we consider reliable. Neither the information nor any opinion expressed constitutes an offer or an invitation to make an offer, to buy or sell any securities or other investment or any options, futures, or derivatives related to such securities or investments. It is not intended to provide personal investment advice and it does not take into account the specific investment objectives, financial situation, and the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities, other investment, or investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. Investors should note that income from such securities or other investments, if any, may fluctuate and that price or value of such securities and investments may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Diversification does not guaranty against loss in declining markets.
