Stock Market Outlook for October 1, 2025
The S&P 500 Index has averaged a return of 0.8% in October over the past 50 years with a frequency of gains for the month at 58%.
*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.
Stocks Entering Period of Seasonal Strength Today:
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Walt Disney Co. (NYSE:DIS) Seasonal Chart
Korn Ferry Intl (NYSE:KFY) Seasonal Chart
YPF Sociedad Anonima (NYSE:YPF) Seasonal Chart
Natural Resource Partners L.P. (NYSE:NRP) Seasonal Chart
Fortuna Mining Corp. (NYSE:FSM) Seasonal Chart
Vanguard Financials ETF (NYSE:VFH) Seasonal Chart
Piper Sandler Companies (NYSE:PIPR) Seasonal Chart
The Markets
Stocks ended the month of September on a positive note as investors show little concern of the US government shutdown that is poised to take effect at midnight. The S&P 500 Index closed up by four-tenths of one percent, holding above support around the 20-day moving average (~6592), the variable hurdle that has kept the short-term trend off of the April lows intact. The weakest, most volatile, period for the equity market through the back half of September has come to an end and, while the declines that are normal did not materialize, it wasn’t an overly positive period. The large-cap benchmark was higher by just over a third of one percent since the close of September 19th, while the Volatility Index (VIX) was higher by 5.4% through this brief timeframe at quarter-end. Evidence of a bottoming setup on the volatility index can be made out, therefore we cannot dismiss further strength in the so-called “fear gauge” before the average (seasonal) peak of the end of October. Despite the transition out of the weakest two-week stretch of the year for stocks, the strategy remains the same, which is to avoid being aggressive in risk (stocks) for now (over the next couple of weeks), but take advantage of any volatility shocks (should they materialize) to increase the risk profile of portfolios ahead of the best six months of the year for stocks that gets underway at the end of October. We have picked our spots in the market to which we want to be exposed, both through and beyond the period of seasonal volatility, in our list of candidates in the market that are worthy to Accumulate or Avoid and the performance continues to be exceptional. Those themes that are enduring according to our three-pronged approach incorporating seasonal, technical, and fundamental analysis keeps us focused and we are not concerned, at all, that the broad market weakness that is normal of September failed to materialize. We will continue to allow for the possibility of volatility to materialize in the month ahead and position the risk metrics of portfolios appropriately until a more ideal setup to reach out on the risk spectrum (eg. away from bonds/gold and towards our four desired sectors to be exposed) is revealed. The Seasonal Advantage Portfolio that we oversee at Castlemoore continues to chart all-time highs and has been realizing some of the best performance that it has seen in years.
Looking ahead, while often thought of as a weak period for equities given some notable meltdowns that have occurred (eg. October 1987), the month of October is, in fact, a positive month, on average, for stocks. The S&P 500 Index has averaged a return of 0.8% in this first month of the fourth quarter over the past 50 years. The frequency of gains for the month is 58%. Returns have ranged from a loss of 21.8% in October of 1987 to a gain of 11.0% in October of 1982. We provide more insight in our just released monthly report for October. Subscribe now.
Just Released…
Our monthly report for October is out, providing you with everything that you need to know to navigate the market through the month(s) ahead.
Highlights in this report include:
- Equity market tendencies in the month of October
- Lack of third quarter volatility
- Four sectors that require focus in portfolios
- One of our preferred equity breadth indicators still climbing
- Long-term cost of borrowing breaking rising trendline support
- Rate cutting cycles in response to a degradation in the labor market has traditionally been equity market negative
- Examining the liquidity that the Fed is providing to the market
- High Yield spreads
- Trend of precious metals could be maturing, but the rising trend of this precious metal is just emerging
- Interest in Small Caps growing
- Banks
- REITs
- Playing the harvest season via Agriculture exposure
- Monitoring the possibility of a US Dollar headwind against equity markets through the first half of the fourth quarter
- Looking to “take-off” in Aerospace this fall
- Strength in the industrial economy not spreading broadly
- Concerns pertaining to Materials exposure in portfolios
- Mixed manufacturer sentiment heading into the fall
- Our list of all segments of the market to either Accumulate or Avoid, along with relevant ETFs
- Positioning for the months ahead
- Sector Reviews and Ratings
- Stocks that have Frequently Gained in the Month of October
- Notable Stocks and ETFs Entering their Period of Strength in October
Subscribers can look for this 112-page report in their inbox and in the report archive.
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With the new month upon us and as we celebrate the release of our monthly report for October, today we release our screen of all of the stocks that have gained in every October over their trading history. While we at Equity Clock focus on a three-pronged approach (seasonal, technical, and fundamental analysis) to gain exposure to areas of the market that typically perform well over intermediate (2 to 6 months) timeframes, we know that stocks that have a 100% frequency of success for a particular month is generally of interest to those pursuing a seasonal investment strategy. Below are the results:
And how about those securities that have never gained in this tenth month of the year, here they are:
*Note: None of the results highlighted above have the 20 years of data that we like to see in order to accurately gauge the annual recurring, seasonal influences impacting an investment, therefore the reliability of the results should be questioned. We present the above list as an example of how our downloadable spreadsheet available to yearly subscribers can be filtered. For a more extensive list of high frequency (70% ) gainers for the month of October, please refer to our monthly report.
Today, in our Market Outlook to subscribers, we discuss the following:
- Monthly look at the large-cap benchmark
- Average tendency of stocks in the month of October
- Securities that have gained or lost in every October over their trading history
- The abnormal decline in Home Prices for July
Subscribers can look for this report in their inbox or by clicking on the following link and logging in: Market Outlook for October 1
Not signed up yet? Subscribe now to receive full access to all of the research and analysis that we publish
Sentiment on Tuesday, as gauged by the put-call ratio, ended bullish at 0.87.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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