October 2025 Market Comments: Nvidia and Tech Surge

October 2025 Market Comments

“Hits from the Bong”, Cypress Hill, 1993

Scratch that; let’s light up Cypress Hill’s “Hits from the Bong”, that 1993 stoner anthem, honouring Dusty Springfield’s extraordinary “Son of a Preacher” music. Because in this month’s financial fog, one thing’s clear: investors needed a serious toke just to stay chill amid the bonkers capex numbers and the tangled web of cross-investments tying Big Tech into a smoky pretzel.

Nvidia is the bong’s main chamber, shipping GPUs like they’re going out of style, as its $5 billion stake in Intel and up-to-$100 billion pour into OpenAI’s Stargate mega-project (a $500 billion joint with SoftBank and Oracle) recycle billions right back into NVDA’s coffers. AMD’s snagging 10% of OpenAI’s chip spend, Meta’s eyeing $20 billion in Oracle cloud, and CoreWeave’s $6.3 billion Nvidia order guarantees the loop keeps spinning – it’s a circular high where everyone’s investing in everyone else’s high.

Capex numbers are straight-up hallucinogenic: more than $500 billion projected for 2026 across hyperscalers, dwarfing entire economies and echoing the dot-com wiring frenzy, but with AI’s promise of trillion-dollar payoffs… or bust. So, like Cypress Hill advises, “Take a hit from the bong, get stoned and forget your troubles, man.” In this AI-fueled haze, staying calm means recognizing the genius in the chaos – cross-investments are diversifying risks while fueling the fire – but keep an eye on the exit when the high fades.

Markets jumped to the beat and revelled in this atmosphere. The MSCI World added 1.94% in October, the Stoxx 600 Europe 2.46%, the Japanese Topix 6.2% and Emerging Markets 4.12%. The ever-growing focus on AI and AI-related plays has triggered another massive outperformance from Growth versus Value and from market-cap versus equal-weighted benchmarks. To wit, the MSCI World Growth and the S&P500 respectively added 4.19% and 2.27% in October, versus -0.59% and -1.04% for the MSCI World Value and the S&P Equal-Weighted. What a stark contrast, leading many to wonder if diversification will pay off again, eventually.

Earnings published so far have been very positive and, more importantly, confirmed the ongoing unprecedented capex frenzy in AI infrastructure at large. Added to that, interest rates are supportive and the Fed doesn’t ring any alarm bell when it comes to inflation. US 10 year yields have headed down 8 out of 10 months in 2025. Credit performed well again despite some isolated failures, and the Itraxx Crossover rose again, for the 8th time out of 10 in 2025! After a parabolic rise at the beginning of the month, Gold calmed down but still recorded a 3.73% rise, which makes it the shining star in 2025 with a +52.5% performance in USD. The dollar regained some ground versus all major currencies but still lags for the year.

That’s it for this month’s Market Comments, stay tuned, markets never skip a beat.

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