Weekly Market Update (Oct 19, 2025)
HIGHLIGHTS
Another week of government shutdown. Q3 earnings season began this week, starting with Financials. Focus shifted to tariff risks and credit risks.
- Banks: Banks reported earnings this week, with top banks reporting strong performance in capital markets and consumer, while some of the banks raised concerns over the credit quality. Stock prices in banking sector dropped sharply late this week.
- UK: The economic data indicate the UK labor market is easing and activity is stagnant in Q3. Markets expect the inflation data to support central bank in easing in November.
- US-China: The US and China trade tension has renewed. Bond rallied as markets sought safety and yields dropped across the curve. Overall market sentiment is reflecting uncertainty elevated in the global markets.
MARKETS
| Nasdaq | 22,679.97 | +2.14% |
| S&P 500 | 6,664.01 | +1.70% |
| Dow | 46,190.61 | +1.56% |
| 10-Year | 4.01% | -4bps |
| Brent | 61.29 | -2.30% |
| DXY | 98.54 | -0.31% |
*Data as of market close. 5-day change ending on Friday.
VIEW FROM THE STREET
Equity
Standard Chartered: We suggest adding more tech equities when they are on 5-10% dip. Medium to long-term investors are recommended to add more US healthcare and China non-financial state-owned companies in tranches in order to benefit from short-term volatility.
UBS: We believe the equity bull market continues. There is new momentum supporting the AI trend, driven by the large partnership between chip makers and hyperscalers.
Fixed Income
Goldman Sachs: US treasuries regained their hedge value against drawdowns in risk assets. The increase in bill supply drives more upward pressure on rates. US treasuries also outperformed global bonds on a cross-currency hedged basis, especially at the longer-end curve.
Standard Chartered: Market sentiment became more cautious due to geopolitical tension and economic data uncertainty because of government shutdown. Risk-off tends to slow down the momentum of emerging market bond fund inflows.
Economy
Barclays: Current updates include China-US dispute, absent US data, US banks, political uncertainty in Japan and France, and economic data in China and Europe. None of them affects the overall still constructive backdrop in global economy.
UBS: Monetary easing in non-recession period usually provides favorable macro backdrop for earnings. Fed remains on track to cut rates.