October Market Update: What’s Driving Markets into Year-End

Originally shared with clients on October 17, 2025

It’s been an eventful start to the fall for markets. Investors have been navigating a mix of headlines — from AI and trade developments to global politics and the resilience of the U.S. consumer. As we enter the final stretch of 2025, much of the focus is on whether consumer strength can carry through the holidays and set up another year of growth in 2026.

Consumer Trends Look Steady

So far, spending appears stable. Delta Air Lines recently reported better-than-expected Q3 results and noted that corporate travel budgets should hold steady—or even rise—next year. That’s not runaway growth, but “steady” is still a good foundation for markets.

AI Shaking Up Market Leadership

In tech, AI continues to drive change. The “Magnificent 7” leaders are now facing new forms of competition, including from each other. ChatGPT’s new shopping partnership with Walmart, announced October 14th, adds fresh pressure on Amazon’s retail business. Meanwhile, large AI firms like OpenAI and Oracle are building their own computing infrastructure, challenging Microsoft and Amazon’s cloud dominance. Even Nvidia is facing renewed competition from AMD and Broadcom.

Broader Market Leadership Emerging

Interestingly, recent performance trends show that equal-weight and small-cap indexes have outperformed the mega-cap-weighted S&P 500 — suggesting market leadership may be broadening beyond the largest companies. See chart at top of the post. 

Our Outlook

We see a stable consumer backdrop, lower rates, and healthy competition as constructive forces for the economy. At The Bycoff Group, we continue to focus on identifying inflection points across industries—finding quality businesses, managing risk, and positioning clients to benefit from a more balanced market environment.

We remain confident and optimistic as we head toward year-end.

The Bycoff Group
Active. Disciplined. Focused on inflection.
www.BycoffGroup.com