Monthly Macro Review - October 2025

Macro at a glance

On October 26, Argentina held midterm legislative elections that served as a critical, make-or-break referendum on President Javier Milei's radical "shock therapy" economic program. Against pre-election polling that suggested a weakening of his support, and following a destabilizing provincial election defeat in September , Milei's La Libertad Avanza (LLA) party secured a decisive nationwide victory, winning approximately 41% o the national vote. The market reaction was immediate and resounding. Upon opening, Argentine assets staged a historic rally: the Merval stock index soared , sovereign bond prices "shot up" as default risk evaporated , and the peso surged against the dollar. (The Guardian, GlobalCapital)

Since the US federal government shutdown began on 1 October, market prices have remained stable, with investors viewing the situation primarily as a temporary variable rather than a regime change: the disruption to data flow has prompted traders to rely on high-frequency indicators and auction results, while equities have generally traded within a narrow range and rates have shown a slight short-term increase. The Congressional Budget Office (CBO), the non-partisan budgetary body that provides independent economic analysis to Congress, estimates that the macroeconomic slowdown is significant but essentially temporary, with an estimated impact of between $7 billion and $14 billion depending on how quickly funding resumes. By way of comparison, the 2018-2019 episode cost $11 billion, including $3 billion in permanent costs. (Reuters)

Japan's October 2025 inflection point was marked by a significant political leadership shift as Prime Minister Shigeru Ishiba, viewed by markets as moderate and fiscally hawkish , was replaced by Prime Minister Sanae Takaichi, a conservative known for her aggressive pro-stimulus and "easy money" stance. The dominant policy mandate coalesced around the "Takaichi Trade" , or "Abenomics 2.0" , centered on a pledged supplementary budget and economic stimulus package valued at over 13.9 trillion yen ($92.2 billion). This political realignment was the catalyst for the key market event: the Nikkei 225 surpassing the 50,000 psychological barrier for the first time in history.(The Business Times)

One Sector, One Insight

Basic Materials and Energy :

Gold and silver experienced extreme two-sided volatility in October. Both metals surged to new all-time highs mid-month—with gold peaking near $4,382 and silver above $54 —driven by safe-haven demand. This rally was met by a severe correction, as silver plunged 16% and gold fell 11%, triggered by a late-month "one-two punch": a "hawkish cut" from the U.S. Federal Reserve and a risk-on U.S.-China trade truce , which collectively liquidated safe-haven positions. For Producers, the successful defense of $4,000/oz gold signals a structural shift in profitability. For Consumers, the month's "rollercoaster" , especially in silver, serves as a stark warning.

Consumption and General Public Services :

Nestle’s (NESN) new CEO has announced mid-October that around 16 '000 jobs will be slashed during the next two years. The cuts would include 12’000 of Nestlé’s 118’000 white-collar positions, and a further 4’000 of its 158’000 jobs in the manufacturing and supply chain. This accounts for around 6% of the total workforce with the objective of focusing on the most performing divisions of the company. The stock rose around 8% on that day. These job cuts will supposedly help Nestlé achieve a "targeted savings" of three billion Swiss francs. (FT)

Financial Services :

Auto parts owner First Brands Group filed for bankruptcy on 29 September 2025; the bankruptcy judge authorised First Brands to immediately borrow $500 million, out of a larger emergency loan of $1.1 billion, so that the company could continue to pay its suppliers and employees and operate during its restructuring. This case, which is now under investigation by the US Department of Justice, highlights the weak links in receivables and supply chain financing: gaps in verification (risk of double-pledged invoices), concentration in seemingly diversified pools, and confusing ownership priorities when multiple conduits touch the same cash flows. Exposures at Jefferies (JEF) and UBS (UBSG) have made headlines, but losses are expected to remain contained. However, this bankruptcy could serve as a warning about certain abuses in private credit, a sector that has been booming for several years. (FT)

Healthcare :

Swiss pharma giant Novartis AF (NVS) has agreed to buy Avidity Biosciences (RNA), a biotech focused on rare diseases, for $12bn, it is the biggest acquisition by the drugmaker in more than a decade. Novartis expects the deal to increase its compound annual growth rate between 2024 and 2029 from 5% to 6%. Novartis has reported core earnings per share of $2.25 in the third quarter, the figure was up from $2.06 reported a year ago. The year-over-year improvement was driven by growth in sales. (FT, Zacks)

Industrials :

Ferrari (RACE) has announced now aiming to make 20 per cent of its models fully electric by 2030, down from a 40 per cent goal announced three years ago. In addition to slashing its EV target, they project their adjusted operating profit would go from €2.1bn this year to €2.75bn by 2030, below investors’ expectations of €3.2bn. Ferrari said that revenues would climb from €7.1bn in 2025 to €9bn in five years, below the €10bn forecast by analysts. The company’s shares went down 15 per cent to €357 after the news. Also, Ferrari has yet to announce the pricing of its new Elettrica model, but there is increasing market scrutiny as to whether it can keep its high margins and sustain residual values as EVs join its petrol and hybrid line-up. This new EV model will not be fully unveiled until next spring. (FT)

Technology and Network Equipments :

On 22 September 2025, OpenAI and Nvidia (NVDA) announced a partnership to deploy 10GW of Nvidia systems, with Nvidia declaring its intention to invest up to $100 billion in OpenAI as capacity is deployed. On 6 October 2025, AMD (AMD) unveiled a 6 GW supply agreement beginning in the second half of 2026 and issued OpenAI a warrant for up to 160 million AMD shares (an option for up to approximately 10% of all outstanding shares), to be acquired in tranches as capacity is deployed. On 13 October 2025, Broadcom (AVGO) and OpenAI announced a collaboration to co-develop and deploy 10 GW of custom accelerators through 2029. At the same time, OpenAI extended its computing contracts with CoreWeave (CRVW) for a total of $22.4 billion and developed the Stargate sites with Oracle (ORCL) and SoftBank (9984). For its part, Microsoft (MSFT) formalised its 27% stake in OpenAI at the end of October 2025. In summary, these agreements underscore how closely capital and capacity are now linked throughout the AI supply chain. It is now up to investors to focus on demand signals from third parties (non-supplier-related cash inflows, revenue per computing hour, and renewal rates) in order to assess the sustainability of this growth beyond supplier-related financing. (FT, Bloomberg)

The stock of the month

Nokia Oyj (NOKIA), still considered by many to be the ‘dinosaur’ of telephony and the internet, saw its share price rise by more than 43.66% to $6.91 in October, initially thanks to better-than-expected third-quarter results announced on 23 October (performance of optical/AI data centres), followed by Nvidia's 1$ billion investment for a 2.9% stake on 28 October, which propelled the share price to its highest level in nearly a decade. (Yahoo Finance)

Key performances

Name	As of October 31	Monthly change	YTD
S&P500	6840.20	2.27%	16,30%
Dow Jones	47562.87	2.51%	11.80%
NASDAQ	23724.96	4.70%	22.86%
FTSE100	9717.25	3.92%	18.89%
CAC40	8121.07	2.85%	10.03%
DAX	23958.30	0.32%	20.34%
SMI20	12234.50	1.03%	5.46%
MSCI WORLD	4389.82	1.73%	18.16%
VIX	17.44	7.13%	0.52%
CHF/USD	1.2421	-0.65%	13.24%
CHF/EUR	1.0770	0.76%	1.24%
Brent $/bbl	64.61	-3.18%	-14.45%
Gold Spot $/oz	4010.3	4.61%	54.18%

Upcoming events

Nov 13: US CPI

Nov 19: FOMC meeting transcript

Nov 19: Nvidia Earnings

Written by Hippolyte Metzger-Otthoffer, Amaury Chartier and João Vieira