Market update: 21 October 2025
The Australian share market notched another record high this week, with the ASX 200 rising 0.4%. Materials stocks led the gains, buoyed by a strong rally in gold prices which pushed past US$4,200 an ounce. Local investors were also eyeing potential interest rate cuts from the RBA, as renewed concerns over global trade tensions and US credit market health stoked uncertainty. Five of the eleven major sectors finished in positive territory, showing resilience despite a mixed global backdrop.
In the US, equity markets bounced back after the previous week’s sell-off, with the Nasdaq, S&P 500 and Dow Jones all closing more than 1.5% higher. Early gains were driven by encouraging signs from China, which appeared to soften its stance on trade tensions. Strong Q3 earnings results from major banks, including JPMorgan and Citigroup, also boosted confidence. However, some of that momentum faded later in the week, as credit concerns resurfaced following loan write-downs by a couple of regional banks. The US market is now pricing in two interest rate cuts by the end of the year.
European markets were mixed. While UK GDP showed a modest rebound in August, and manufacturing activity improved, rising unemployment signalled a cooling labour market. The Eurozone’s broader equity benchmarks ended slightly higher overall, though the FTSE dipped on the back of weaker sentiment in London. Meanwhile, in Greater China, equity markets struggled. The Shanghai Composite and Hang Seng indexes both posted losses as trade tensions with the US persisted and consumer data pointed to possible deflation.
Japan’s markets also closed lower this week, as political uncertainty came into focus. The departure of the Komeito party from the ruling coalition has created a more fluid outlook for leadership. If a new coalition is formed, Sanae Takaichi could emerge as the next Prime Minister, adding another layer of complexity to the economic outlook.
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This information has been issued by Instreet Investment Limited (ACN 128 813 016 AFSL 434776) as Responsible Entity of the Raiz Invest Australia Fund (ARSN 607 533 022) and has been prepared without taking into account your objectives, financial situation or needs. Before acting on such information, you should conduct your own review or consult a financial advisor before making a decision to invest. Please read the relevant Product Disclosure Statement and any associated reference documents before making an investment decision. In accordance with the Design and Distribution Obligations, we maintain TMDs for our Funds. All documents can be found on the Raiz website www.raizinvest.com.au, or calling the Customer Support team on 1300 754 748.
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Please note that past performance is not a reliable indicator or guarantee of future performance. Historical returns, forecasts, and market commentary are provided for general informational purposes only. All investment carries risk and may result in loss of capital.
