The Monthly Market Wrap provides an insightful analysis of treasury yields, fixed income performance, mega-cap stocks, and key economic indicators in October 2025. It also delves into housing market data and the performance of commodities.
Disclaimer: The ongoing government shutdown delayed several key economic releases, limiting visibility into the broader economy. With labor and select inflation reports postponed, the Fed Funds Rate 25 basis point rate cut to a target range of 3.75%–4.00% remains the most significant policy development.
Key Stock Market Index Performance
Markets moved higher across the board for the second straight month, as the S&P 500 posted a gain of 2.3%. This advance was led by the Nasdaq and emerging markets, which increased by 4.7% and 4.2% respectively. October’s broad-based gains reflect continued investor confidence, as the Fed cut interest rates by 25 basis points for the second consecutive month.
Sector performance was split in October as Technology led the way with another near-7% month. Communication, Real Estate, and Financials were all negative, though none worse than Materials, which slipped 4.4% for the month.
Economic Data
Employment
With September’s employment report delayed by the ongoing government shutdown, official labor data remains limited. The most recent release from August showed unemployment at 4.3%, reflecting a gradually cooling job market.
Inflation vs. Fed Funds Rate
The US inflation rate rose to 3.01% in September, though core inflation fell to 3.02%. The US Consumer Price Index sits at 0.3% MoM, and US Personal Spending went unreported as a result of the government shutdown.
At the October 29th FOMC meeting, the Federal Reserve cut its key Fed Funds Rate target range by another 25 basis points to 3.75%-4.00%. Fed Chair Powell stated that “job creation is pretty close to zero”, and that a further rate cut in December is “not a foregone conclusion, far from it”. The FedWatch tool still assumes over a 68% chance of a third straight cut when the FOMC meets next on December 10th.
Housing Prices and Mortgage Rates
Existing Home Sales increased by 1.5% MoM in September, and the Median Sales Price of Existing Homes fell for the third month in a row by 1.7%, with prices sitting at $415,200. Mortgage rates declined throughout October, with the 15-year Mortgage Rate at 5.41% and the 30-year at 6.17% to end the month.
While US New Single-Family Home Sales were unreported, the NAHB Housing Market Index can be used to measure homebuilder confidence, providing an early indication of construction sentiment and future building activity.
Fixed Income
Treasury yields declined across most of the curve in October, with the 1-year serving as the lone outlier to have increased. The largest decline came from the 1-month Treasury, down 14 basis points to 4.06%, followed by the 3-month, which fell slightly less, by 13 basis points to 3.89%.
Bautis Financial LLC is a registered investment advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.