Monthly Observations - October 2025

By Chris Zaccarelli

Monthly Observations

The S&P 500 rose 1.8% in September, continuing its record-setting pace. The MSCI All Country World index rose 1.6% in September, improving its year-to-date return to 9.2%. The Bloomberg BarCap U.S. Aggregate Bond index rose 1.2% during September, which increased its year-to-date gain to 6.6%.

September was a positive month for markets, defying the historical tendency for it to be the worst month of the year. The Federal Reserve cut interest rates by 0.25% as expected, and the economy continued to expand at a healthy pace. Trade negotiations continued to make progress and investor sentiment remained positive.

Monthly Highlights

The Federal Reserve cut rates for the first time since December 2024

September defied its reputation as the worst month of the year

The economy continued to expand and trade negotiations progressed

News in Review

Below are some stories that caught our eye this past month. To learn more, follow the links to the full article.

Federal Reserve Cuts Rates for First Time in 2025

The Federal Reserve cut interest rates by 0.25% at their September meeting, the first rate cut of 2025. Fed Chair Powell noted that inflation had continued to move toward their 2% target and that the labor market had cooled to a more sustainable pace. The cut was widely expected by markets and was seen as a sign that the Fed's confidence in the economic outlook had improved.

US Economy Continues to Expand at a Healthy Pace

The US economy continued to grow at a healthy pace in the third quarter, with GDP growth coming in above expectations. The resilience of the economy in the face of tariff headwinds earlier in the year was a positive sign, and most economists now believe that the risk of a recession has diminished significantly.

Stock Market Posts Best September Performance in Over a Decade

September is historically the worst month of the year for the stock market, but 2025 was a notable exception. The S&P 500 rose 1.8% in September, one of the best September performances in over a decade. The positive performance was driven by the Fed rate cut, strong economic data, and continued progress in trade negotiations.

Archaeologists Discover Ancient City Buried Under Volcanic Ash in Italy

Archaeologists have discovered the remains of an ancient Roman city buried under volcanic ash near Naples, Italy. The city, which dates back to the 1st century AD, was buried by a volcanic eruption and has been remarkably well preserved. The discovery provides new insights into daily life in ancient Rome and is expected to be one of the most significant archaeological finds in years.

DISCLOSURES

Securities offered through LPL Financial, Member FINRA/SIPC. Blackbridge Financial is another business name of Independent Advisor Alliance, LLC. All investment advice is offered through Independent Advisor Alliance, LLC, a registered investment adviser. Independent Advisor Alliance, LLC is a separate entity from LPL Financial. The opinions expressed in this material do not necessarily reflect the views of LPL Financial.

This newsletter was written and produced by the Independent Advisor Alliance, LLC. Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. The views stated in this letter should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein. Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.

S&P 500 INDEX: The Standard & Poor's 500 Index is an unmanaged, capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

NASDAQ 100 INDEX: The Nasdaq 100 Index is an unmanaged, capitalization-weighted index of the largest 100 non-financial stocks traded on the Nasdaq market. Unlike the S&P 500 it does not represent all major industries and may be more volatile than more broadly constructed indices.

MSCI ACWI INDEX: The MSCI ACWI captures large- and mid-cap representation across 23 developed markets (DM) and 24 emerging markets (EM) countries. With 2,495 constituents, the index covers approximately 85% of the global investable equity opportunity set.

Bloomberg U.S. Aggregate Bond Index: The Bloomberg U.S. Aggregate Bond Index is a broad-based index of the U.S. investment-grade, fixed-rate bond market, including both government-related and corporate securities and mortgage-backed and asset-backed securities.

Please note this newsletter contains hyperlinks to additional content. The information being provided is strictly as a courtesy. We make no representation as to the completeness or accuracy of information provided by these websites.