Investment update

Weekly insight into the marketplace.

October 27 to 31, 2025

Stock markets extended rallies

The Wall Street equity benchmarks reached record highs on Monday, following news that U.S. and Chinese officials had agreed on the framework for a new trade deal over the weekend. The Dow gained 0.71%, the S&P 500 rose 1.23% (its first close above 6,800 points) and the Nasdaq advanced 1.86%. Canada’s resource-heavy TSX moved in the opposite direction, losing 0.25%, alongside falling prices for precious metals. Gold fell 2.9% to about US$3,992 per ounce, as the possibility of a U.S.-China trade deal diminished its safe-haven appeal. The TSX bounced back on Tuesday with a 0.48% gain. The tech sector drove performance after Canadian electronics service provider Celestica reported US$3.2 billion in quarterly revenue, a 28% jump year-over-year. The main U.S. stock indexes remained at record levels as investors turned their attention to corporate earnings and news of AI deals. The Nasdaq led the way with a 0.80% gain. On Wednesday, the TSX suffered a broad-based decline of 0.90% following the Bank of Canada’s 0.25% interest-rate cut. Investors were deterred by the official statement accompanying the decision, which dampened expectations for further cuts. The U.S. Federal Reserve (the Fed) also announced an interest-rate cut of 25 basis points. Following the decision, Wall Street saw mixed results, with the S&P 500 flat and the Dow slipping 0.16%. The tech-heavy Nasdaq rose 0.55% with a rally in shares of Nvidia pushing the AI juggernaut to US$5 trillion in market capitalization. The major U.S. indexes pulled back on Thursday as investors reacted to U.S. President Donald Trump and Chinese President Xi Jinping meeting in South Korea, but not announcing a trade deal. The Dow lost a modest 0.2%, but the S&P 500 and the Nasdaq dropped 1% and 1.6%, respectively. The TSX edged up 0.11%. Friday saw the U.S. benchmarks turn positive again, led by a 0.61% gain for the Nasdaq as shares of Amazon surged following its strong quarterly earnings report. In Canada, Canadian National Railway reported positive financial results which helped the TSX rise 0.27%.

The Bank of Canada lowered its policy rate

On Wednesday, the Bank of Canada reduced its policy interest rate by 25 basis points to 2.25%. It was the second consecutive rate cut (the previous cut occurred on September 17) and the fourth reduction this year. The October 29 meeting – the second last scheduled for 2025 – also included the Bank’s Monetary Policy Report (MPR) and its first Gross Domestic Product (GDP) forecast since January. The Bank’s outlook now predicts GDP will grow 1.2% this year, 1.1% in 2026 and 1.6% in 2027. Globally, they believe the economy will slow from about 3.25% in 2025 to about 3% in 2026 and 2027. The Bank’s commentary highlighted that U.S. tariffs have negatively affected demand for Canadian goods, and the overall “structural shift” in Canada-U.S. trade relations has changed the course of the Canadian economy and increased pressure on inflation. In his news conference, Governor Tiff Macklem also noted that monetary policy “can’t target the hard-hit sectors: aluminum, steel and autos. It can’t help companies find new markets. It can’t help companies reconfigure their supply chains.” The Bank’s press release signalled that the October 29 rate cut was likely the last for the foreseeable future. It noted that the current policy rate is at “about the right level to keep inflation close to 2% while helping the economy through this period of structural adjustment.” Canadians will now look ahead to the November 4 Federal Budget for greater insight.

Tech giants reported quarterly earnings

Five of the “Magnificent Seven” tech companies reported quarterly earnings last week. Google’s parent company, Alphabet, saw its share price jump 5% on Wednesday after the company reported revenue of US$102.4 billion, well ahead of the US$99.85 billion analysts were expecting, and up from US$88.3 billion in the same quarter last year. Microsoft reported better-than-expected results. Quarterly revenue climbed to US$77.67 billion, an 18% increase from the same quarter last year, and higher than the US$75.33 billion that was expected. The company highlighted a 40% increase in its Azure cloud business. Meta Platforms, Facebook’s parent company, reported a quarterly revenue of US$51.24 billion, which beat Wall Street’s US$49.6 billion forecast. Despite exceeding market projections, Meta’s share price fell 10% on Thursday after its financial results showed earnings per share came in short of expectations, as the company paid off a one-time tax bill and increased its capital expenditure. Meta has invest billions in its AI infrastructure and now estimates that its capital expenditure will reach a range of US$70 to US$72 billion in 2025. Amazon reported its earnings after the closing bell on Thursday and also outpaced revenue estimates, pulling in US$180.2 billion through the quarter versus the forecast of US$177.8 billion. Apple, which saw its market cap surpass US$4 trillion earlier in the week, also released its earnings after Thursday’s close. For the quarter, Apple posted revenue of US$102.5 billion against the US$102.2 billion that was expected.