October 2025 Market Review

World Happenings:
October 2025 brought a renewed sense of optimism to global markets as investors digested signals of a gradual policy shift by major central banks.

The US Federal Reserve hinted at possible rate cuts in early 2026, easing bond yields and lifting investor sentiment. In Europe, improving manufacturing data and stabilizing inflation strengthened market resilience, while Asian markets benefited from China’s economic stimulus measures and rising export activity.

Commodity markets showed a mixed picture; oil prices remained volatile amid OPEC supply concerns, but gold and silver extended their gains as investors sought stability in safe-haven assets amid ongoing geopolitical uncertainties.

Market Roundup:
Indian equities followed global cues and posted solid gains through October 2025, supported by upbeat corporate results and strong domestic liquidity.

- Sensex: Closed near 83,938, marking a strong monthly rise and hitting new lifetime highs.
- Nifty 50: Traded between 25,300–25,500, supported by robust performance in banking, IT, and auto sectors.
- Foreign Portfolio Investors (FPIs): Turned net buyers after two months of outflows, encouraged by a softer US dollar and easing bond yields.
- Domestic Institutional Investors (DIIs): Continued to provide a strong base through sustained mutual fund and SIP inflows.

Investor sentiment remained upbeat as India’s macro indicators, inflation, consumption, and credit growth, continued to show resilience, offsetting global volatility.

Mutual Fund Industry Performance:
The mutual fund industry continued to perform robustly in October 2025, driven by sustained retail participation and record SIP contributions.

- Total Industry AUM: Reached a record ₹79.87 lakh crore, supported by healthy inflows across categories.
- Equity Mutual Funds: Logged net inflows of ₹24,690 crore, marking a 19% decline from September but still signaling strong retail interest.
- Debt Funds: Attracted substantial net inflows of ₹1.59 lakh crore, primarily driven by short-duration and money market categories as investors parked funds amid global uncertainty.
- SIP (Systematic Investment Plans) Inflows: Rose to an all-time high of ₹29,529 crore, up from ₹29,361 crore in September, reflecting continued trust in long-term disciplined investing.
- Hybrid Funds: Reported net inflows of ₹14,156 crore, boosted by investor preference for balanced allocation strategies.
- Gold ETFs: Continued to see investor interest as safe-haven demand persisted, though exact inflow numbers are yet to be officially disclosed for this month.

Sectoral Insights:

- Banking and Financials: Strong quarterly earnings and credit growth drove the sector, with private and PSU banks both seeing healthy investor interest.
- Information Technology: Benefited from improving global tech spending outlook and currency tailwinds.
- Automobiles: Recorded solid festive season sales, particularly in passenger and two-wheeler segments.
- Consumer Goods: Remained stable on rural recovery and festive demand.
- Commodities (Gold & Silver): Gold traded between ₹1,23,000–₹1,27,000 per 10 grams, while silver hovered around ₹1,42,000–₹1,49,000 per kg, continuing their upward trend amid global inflation concerns and rising industrial usage, especially in renewable and electronics sectors.

Conclusion:
October 2025 marked a month of renewed confidence and strong market participation. With FPIs turning buyers, corporate earnings meeting expectations, and inflation staying under control, Indian markets are entering the final quarter of the year on a positive note. Investors are advised to stay diversified across equity, hybrid, and gold assets, continue SIP investments for consistent compounding, and monitor global rate developments as central banks begin pivoting toward a more accommodative stance.

Sources:
Reuters, Economic Times, Times of India, AMFI, Business Insider, NSE, Moneycontrol, Mint, Trading Economics, OECD

Seral Mehta

CFP, CWM Senior Financial Product Analyst | FIKAA