Stocks Rise as Trade Optimism and Tech Strength Extend the Rally
Week Ending October 31st, 2025
Markets posted their third straight week of gains, supported by progress on U.S.–China trade discussions, upbeat third-quarter corporate results, and renewed strength in large-cap technology names. Although the Federal Reserve struck a more cautious tone at its latest meeting, investor sentiment remained resilient, lifting most major U.S. indexes to record highs.
The S&P 500 gained 0.71%, the Nasdaq Composite advanced 2.24%, and the Dow Jones Industrial Average added 0.75%. By contrast, the MSCI EAFE Index, which tracks developed international markets, fell 0.55%.
On the Canadian front, the S&P/TSX Composite Index finished near 30,260—down roughly 0.3%—as softness in energy and financials offset gains in materials and technology.
Market Overview
Weekly Market Performance (October 27 – October 31, 2025)
- S&P 500: +0.71%
- Nasdaq Composite: +2.24%
- Dow Jones Industrial Average: +0.75%
- MSCI EAFE (International Developed Markets): -0.55%
- S&P/TSX Composite Index (Canada): -0.30%
U.S. Markets: Tech and Trade Drive Momentum
Stocks rose early in the week as reports of renewed trade cooperation between the U.S. and China boosted global sentiment. The rally was further fueled by strong earnings from major technology firms, helping the S&P 500 close above 6,800 for the first time.
Mid-week, attention turned to the Federal Reserve’s policy meeting. As expected, the Fed cut its benchmark interest rate by 0.25%, but Chair Jerome Powell’s cautious tone—stating that another rate adjustment in December was “not a foregone conclusion”—tempered some optimism. Powell emphasized that monetary policy is “not on a pre-set course,” particularly given the lack of timely data due to the ongoing U.S. government shutdown.
By Friday, markets regained footing as upbeat corporate results and renewed buying in large technology and AI-related names lifted all three major indexes. The Nasdaq once again led the way, continuing a strong run powered by investor enthusiasm for artificial intelligence and software innovation.
Canada & the TSX
The Canadian market trailed its U.S. peers last week, with the S&P/TSX Composite Index slipping modestly as weaker energy prices offset gains in technology and materials.
- Energy (-1.2%): Crude oil prices edged lower amid steady global supply and profit-taking following October’s rally.
- Materials (+1.8%): Gold and copper prices showed resilience, supporting mining and precious metal producers.
- Financials (-0.4%): Canadian banks lagged slightly as investors awaited upcoming earnings results and guidance.
- Technology (+2.5%): Canadian tech names, including Shopify, benefited from global strength in software and AI-linked companies.
Investor focus in Canada has shifted to fiscal policy, with attention on Ottawa’s upcoming federal budget announcement. Meanwhile, the Canadian dollar traded near C$1.36 per U.S. dollar, largely unchanged from the previous week.
What’s Driving the Market
Trade Developments: Renewed optimism over U.S.–China trade discussions supported equities globally. Markets welcomed news that both sides plan to continue negotiations aimed at easing restrictions and stabilizing supply chains.
AI and Technology Momentum: The rally in artificial intelligence and large-cap technology names continues to lead market performance. Strong Q3 earnings from major players have reinforced investor confidence in this long-term growth theme.
Federal Reserve Messaging: While the Fed’s rate cut was widely expected, its more cautious outlook reminded investors that further policy easing is not guaranteed. Powell’s comments underscored the Fed’s data-dependent approach in an uncertain economic environment.
Corporate Earnings Strength: Third-quarter results have broadly exceeded expectations, with solid growth across technology, healthcare, and financial sectors supporting the market’s advance.
Why This Matters
For those already working with us—and for those considering doing so—weeks like this highlight why we emphasize diversification and discipline.
U.S. vs. Canadian Markets: U.S. indexes continue to benefit from heavy exposure to technology and AI, while Canada’s TSX remains more resource- and financial-sector driven. This underscores the importance of cross-border diversification.
The Role of the Fed: Interest rate policy continues to shape investor sentiment. The Fed’s more measured stance may lead to short-term volatility, but it also helps reinforce longer-term stability by avoiding overcorrection.
Earnings Resilience: Corporate profits remain stronger than expected, suggesting that growth and innovation—especially in technology—are still supporting equity valuations.
Canadian Outlook: Canada’s slower performance this week highlights the value of sector balance. As one area lags, another often offsets it—an essential feature of a well-diversified portfolio.
Economic Snapshot
Federal Reserve Decision:
The Fed lowered its benchmark rate by 0.25%, noting that future moves will depend on economic data. Chair Powell emphasized the central bank’s flexibility, given the limited availability of recent reports due to the government shutdown.
Key Economic Reports: Week Ahead (November 3 – 7, 2025)
Monday, November 3
- PMI Composite – Manufacturing
- ISM Manufacturing
- Construction Spending
- Auto Sales
- Remarks from Fed Governor Lisa Cook
Tuesday, November 4
- Trade Deficit
- Factory Orders
- Job Openings (JOLTS)
Wednesday, November 5
- ADP Employment Report
- PMI Composite – Services
- ISM Services Index
Thursday, November 6
- Weekly Jobless Claims
- Productivity; Wholesale Inventories
- Fed officials Williams, Paulson, and Musalem speak
Friday, November 7
- U.S. Jobs Report
- Consumer Sentiment
- Consumer Credit
- Remarks by Dallas Fed President Logan
Corporate Earnings: This Week
Monday, November 3
- Palantir Technologies Inc. (PLTR)
- Vertex Pharmaceuticals Inc. (VRTX)
Tuesday, November 4, 2025
- Advanced Micro Devices Inc. (AMD)
- Shopify Inc. (SHOP)
- Uber Technologies Inc. (UBER)
- Arista Networks Inc. (ANET)
- Amgen Inc. (AMGN)
- Pfizer Inc. (PFE)
- Spotify Technology (SPOT)
Wednesday, November 5
- McDonald’s Corp. (MCD)
- AppLovin Corp. (APP)
- QUALCOMM Inc. (QCOM)
- Robinhood Markets Inc. (HOOD)
- DoorDash Inc. (DASH)
- McKesson Corp. (MCK)
Thursday, November 6
- ConocoPhillips (COP)
- Parker-Hannifin Corp. (PH)
Friday, November 7
- Berkshire Hathaway Inc. (BRK.A / BRK.B)
- Constellation Energy Corp. (CEG)
- KKR & Co. Inc. (KKR)
- Duke Energy Corp. (DUK)
“Thinking about what you can't control only wastes energy and creates its own enemy.”
– Sandy Fries
Stick your fingers in my eyes, then move them and watch my jaws open wide. What am I?
Last Week's Riddle: If used in an emergency, I can help the hero – yet when you multiply all the numbers on my face, all you get is zero. What am I?
Answer: A phone.
A Pink Lady and a Cat walk into a Raymond James Branch on Halloween...
Footnotes and Sources
1. WSJ.com, October 31, 2025
2. Investing.com, October 31, 2025
3. CNBC.com, October 27, 2025
4. CNBC.com, October 28, 2025
5. WSJ.com, October 29, 2025
6. CNBC.com, October 30, 2025
7. CNBC.com, October 31, 2025
8. WSJ.com, October 29, 2025
9. IRS.gov, April 1, 2025
10. EveryDayHealth.com, June 11, 2025
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.
The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. The Nasdaq Composite is an index of the common stocks and similar securities listed on the Nasdaq stock market and considered a broad indicator of the performance of stocks of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.
U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.
International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.
Please consult your financial professional for additional information.