Weekly Market Recap — Week Ending October 17, 2025
Markets Enter the Burn Zone as the Moon Separates from Venus and Moves Toward a Critical Reset
As we open the trading week, the market sits under a waning balsamic Moon in Libra, freshly separated from Venus, and on course for a New Moon in the Via Combusta—the so-called fiery road, a zone from 15° Libra to 15° Scorpio long associated with instability, purification, and volatility.
Today’s Moon–Venus conjunction, now separating, reflects a brief moment of emotional alignment between sentiment (Moon) and value (Venus). That window is now closing. Venus remains early in Libra, dignified but not yet dominant—offering ideals of balance and beauty, but with little strength to assert them yet. The Moon, moving quickly ahead, carries the imprint of this conjunction forward into darker, more volatile territory. As she enters the Via Combusta, we transition into a stretch of sky archetypally linked to crisis, recalibration, and irreversible momentum.
This zone has never been comfortable for markets. The Via Combusta is not inherently negative, but it is purifying. It strips away illusion and sentimentality, especially when the Moon is balsamic—a phase marked by psychological release and internal closure. The Moon here doesn’t initiate; she reveals what must be left behind. Combined with Libra’s valuation-driven air and the Moon’s rapid motion into combustion with the Sun tomorrow, we are likely to see increased nervousness in risk assets and a preference for safety—even as surface-level optimism persists.
In practical market terms, this manifests as a gap between price action and conviction. Stocks may rise, as they did last week, but behind the gains is a retreat in yields, a surge in gold, and the quiet exodus from speculative growth into hard assets and income. The Moon leaving Venus and heading toward the Sun in a combust zone speaks to a narrative transition. Markets are emotionally detaching from prior cycles—rotations, growth expectations, policy assumptions—and moving toward something not yet fully formed, but already underway.
This is further complicated by Mars and Mercury conjoined in Scorpio, still active and exerting pressure behind the scenes. These two together in Scorpio reflect strategic maneuvers, institutional discretion, and penetrating analysis. This is not about headlines or price movement; it’s about where the capital is actually moving—and why. While the Libra trio (Sun, Moon, Venus) tries to maintain balance, Scorpio’s influence digs beneath the surface. Traders and analysts may sense calm, but positioning says otherwise.
Add to that the dominance of cardinal signs and a heavy air–water mix, and you get a market with high momentum potential but no coherent direction. This is energy that wants to move but can’t yet decide how—which aligns perfectly with the Moon’s current condition: balsamic, separating from a benefic, entering a historically fraught zone, and heading toward solar conjunction. That’s not the profile of a confident market—it’s the psychological tone of a market in transition.
Tomorrow’s New Moon at 26° Libra, firmly within the Via Combusta, will be the formal reset. But the emotional and strategic groundwork is happening now. The fact that this lunation will be combust—burning in the light of the Sun—means it may not provide immediate clarity. The new cycle begins, but visibility remains low. It may not be until later in the week, or even the next lunation phase, that direction solidifies.
Key Archetypal Indicators Driving Market Mood:
Moon separating from Venus in Libra → Valuation sentiment cooling, emotional distance from recent gains, shift from aesthetics to function.
Moon entering the Via Combusta (15° Libra to 15° Scorpio) → Transition zone of volatility, purging, and recalibration. Risk-off sentiment beneath the surface.
Approaching Sun–Moon conjunction (New Moon, Oct 20) → A reset in narrative, but not an immediate one. Expect reorientation, not resolution.
Mars–Mercury in Scorpio → Institutional secrecy, intense analysis, and potentially disruptive capital flows not visible on the surface.
Elemental imbalance (Air + Water dominant) → High perception, low conviction. Emotional markets driven more by mood and narrative than trend.
Today, the market enters a zone of psychological dislocation—where outward metrics suggest progress, but inward sentiment is tense and preparing for change. The Moon’s separation from Venus tells us that last week’s rally may already be emotionally spent. The upcoming New Moon newly out of the Via Combusta reinforces that the path ahead is not linear—it’s purifying, and potentially disruptive before it becomes constructive.
Expect sentiment to remain fragile, and moves to lack follow-through, until we emerge from this lunar reset. Until then, this is a time for quiet repositioning, strategic restraint, and focused observation—not for bold declarations. Markets may act calm—but under the surface, realignment is already underway.
After a rocky start to October, markets rebounded last week, regaining their footing in a choppy and headline-driven environment. Major U.S. equity indexes posted solid gains near 2% across the board, reversing prior-week losses of similar magnitude. A strong start to earnings season, shifting sentiment in bond markets, and continued volatility in gold and crypto shaped investor positioning. Meanwhile, macroeconomic developments and monetary policy expectations abroad added texture to an already complex risk landscape.
U.S. Markets: Resilience Despite Crosscurrents
The S&P 500 closed the week up 1.7% to 6,664, the Dow gained 1.6% to finish above 46,190, and the Nasdaq outperformed with a 2.1% weekly gain. Underneath the rebound was a battle between optimism around corporate earnings and anxiety over broader macro risks, including lingering questions about the health of regional banks and the path of U.S.-China trade negotiations.
Volatility surged mid-week, with the Cboe Volatility Index (VIX) spiking to its highest intraday level since April before easing to end the week down 4.1% at 20.8. That VIX behavior highlights how sensitive market participants remain to data surprises and macro policy shifts.
Gold surged 5.4% for the week, now up an eye-popping 57.8% year-to-date. Futures reached as high as $4,392 per ounce on Friday morning—a historic level that underscores the metal’s role as a hedge amid economic and geopolitical uncertainty. Bitcoin, by contrast, fell below $104,000—off nearly 17% from its early October peak. The crypto retreat suggests risk appetite remains inconsistent across asset classes.
In fixed income, Treasury yields fell notably. The 10-year yield briefly dipped below 4.00%, reflecting a flight to quality amid a renewed focus on slowing growth. The 2-year yield dropped to 3.46%, its lowest since early 2022, compressing the 2s-10s spread back to 54 basis points. For the week, U.S. aggregate bonds returned 0.5%, with convertibles leading at 1.3%.
Corporate Earnings: Financials Lead the Charge
Banks led the earnings conversation. Major U.S. financial institutions exceeded third-quarter expectations, with the financials sector showing earnings growth of 18.2%, outpacing the 8.5% forecast across the broader S&P 500. Investment banking divisions reported notable recoveries as deal flow picked up and capital markets activity improved.
That sector-level strength helped boost sentiment around small- and mid-cap stocks, with small caps gaining more than 2.3% across all styles. The Russell 2000 saw outsized demand as investors rotated into domestically sensitive equities following signs of resilience in consumer demand and labor market stability.
Inflation & Fed Watch: CPI On Deck, Rate Cut Expectations Building
The inflation conversation is set to return to center stage this coming week. While most federal reports remain delayed due to the ongoing government shutdown, the Bureau of Labor Statistics confirmed a CPI release is slated for October 24. The last reading showed annual inflation at 2.9% in August, up slightly from July. Any upside surprise here could recalibrate bond markets, especially with real yields declining and inflation expectations holding steady.
Fed Chair Powell’s past remarks—that the labor market is no longer a primary source of inflation—are gaining traction among investors. With the 2-year Treasury yield falling and short-term rate futures beginning to price in cuts as early as Q1 2026, markets are increasingly leaning into a dovish pivot. The risk now is that a stronger-than-expected CPI may force a repricing.
Global View: Mixed Growth Signals and Rate Moves
Globally, Europe posted mixed data. Germany’s flash manufacturing PMI rose to a four-month high of 43.2, while its services PMI slipped to a nine-month low of 49.4. France and Spain equities were strong, while German stocks lagged—down 1% on the week.
Japan and China continued to diverge. Japanese equities gained modestly while China’s market slid 3.9% amid softening inflation and concerns around real estate sector instability. Chinese CPI was reported at -0.3%, stoking fears of entrenched deflation.
The Swiss National Bank cut rates by 50 basis points to 0.5%, citing global demand weakness and subdued domestic inflation. The move pressured the Swiss franc, which fell to 0.8890 per USD. This action underscores the divergence in monetary policy paths across developed markets as inflation normalizes at different speeds.
Korea was the standout in emerging markets, up 4.0% on the week and 74.4% year-to-date, bolstered by tech demand and favorable trade data. Meanwhile, Brazil and Mexico also saw healthy gains, while China, Indonesia, and Taiwan declined.
Commodities: Oil Drifts Lower, Gold Takes Command
West Texas Intermediate (WTI) crude slipped 1.9% to a five-month low below $57 per barrel before bouncing late Friday. This marked its third consecutive weekly loss, as concerns about global demand and inventory builds outweighed geopolitical risks.
Commodities overall gained 1.5%, driven largely by gold. The Bloomberg Commodity Index is up 10.6% year-to-date, with precious metals dominating flows and sentiment.
Fund Flows: Bonds and Alternatives See Inflows
Fund flow data for September showed strong demand for fixed income, with taxable bond funds pulling in $64.8 billion and municipal bond funds attracting $7.9 billion. This continues the broader trend of investors seeking income in a lower-yield world.
On the equity side, U.S. large growth funds saw outflows of $8.0 billion in September, capping a 12-month net outflow of nearly $54 billion. In contrast, commodities-focused and multisector bond funds were top gainers. Total assets in long-term funds rose to $34.2 trillion.
Morningstar categories with the strongest inflows included Intermediate Core Bond, Commodities Focused, and Foreign Large Blend. On the losing end, Mid-Cap Value and Leveraged Equity strategies were out of favor.
Outlook: Earnings, Inflation, and Sentiment in Focus
This week, investors will watch existing home sales, unemployment claims, and—most critically—the delayed CPI report. If inflation trends continue higher, the narrative around rate cuts may stall. However, should CPI show further moderation, it could accelerate the rotation into duration-sensitive assets.
The macro environment remains one of decelerating inflation, tentative economic growth, and cautious optimism around corporate earnings. Markets are oscillating between fear and opportunity, with sector rotation and factor dispersion driving returns.
Bottom line: The rebound in equities signals investor resilience, but risks remain elevated. Gold’s relentless rally reflects hedging demand, while bond markets signal a cautious outlook. How inflation data unfolds this week will be pivotal in shaping Q4 strategy.
Stay tuned.