Dear Friends,

Tangents: Happy Monday!
Carolann is away from the office for the Sohn San Francisco Investment Conference. I will be writing the newsletter on her behalf.

October 27, 1904 – Official Opening of the New York City Subway
October 27, 1954 – Founding of the American Football League (AFL)

October 27, 2005 Surgeons in France performed the world’s first partial face transplant on a woman who was mauled by a dog. Go to article

Strange object between Saturn and Uranus is ‘evolving’ its own ring system, study suggests

Astronomers have found signs that the small icy world Chiron, orbiting between Saturn and Uranus, may be forming a new ring system in near-real time.

Neanderthals could be brought back within 20 years — but is it a good idea?

With today’s technology, we cannot bring back Neanderthals. But even if future advances allow it, should we?

Interstellar object 3I/ATLAS is about to get very active

The interstellar comet 3I/ATLAS is barreling toward its closest point to the sun as perihelion looms on Oct. 29. How different will it look when it reappears on the other side?

The magical white stone wonderland with effervescent bathing pools
From a distance, Pamukkale in southwestern Turkey looks every bit like a ski resort. So why don’t its white slopes melt as temperatures rise? Because this unusual and beautiful wonder isn’t snow at all

Meat eaten by city-dwelling Americans produces more CO2 than the entire UK

but there are easy ways to slash itHalving how much edible food is thrown away, swapping beef for pork or chicken and having one meatless day week could slash the carbon "hoofprint" of U.S. cities by up to 51%, a new study finds.

Día de los Muertos: Celebrations for the holiday — also known as Day of the Dead — have begun in Mexico City, with hundreds taking to the streets dressed as La Catrina, an iconic skeleton figure

PHOTOS OF THE DAY

Cambridgeshire, UK

People punt along the River Cam
Photograph: Joe Giddens/PA

Suqian, China

A technician works on chip processing equipment at a semiconductor manufacturing plant
Photograph: AFP/Getty Images

Suqian, China

Staff take a boat to check the growth of crabs in Metasequoia Forest at Sihong County Crab Breeding Base in Jiangsu Province
Photograph: Costfoto/NurPhoto/Shutterstock
Market Closes for October 27th , 2025

International Markets

Bonds

Commodities

Market Commentary:
On this day in 1923, the Roaring Twenties bull market began after the Dow Jones Industrial Average closed the day at 85.76. The run-up lasted nearly six years and lifted stocks by 344.5%.

Canada

By Bloomberg Automation
(Bloomberg) — The S&P/TSX Composite fell 0.3% at 30,275.76 in Toronto.
The move follows the previous session’s increase of 0.6%.
Agnico Eagle Mines Ltd. contributed the most to the index decline, decreasing 5.0%.
NGEx Minerals Ltd. had the largest drop, falling 12.0%.
Today, 123 of 213 shares fell, while 88 rose: 8 of 11 sectors were lower, led by materials stocks.

Insights
* This year, the index rose 22%, heading for the best year in at least 10 years
* This month, the index rose 0.8%
* The index advanced 24% in the past 52 weeks. The MSCI AC Americas Index gained 19% in the same period
* The S&P/TSX Composite is 1.7% below its 52-week high on Oct. 15, 2025 and 36.2% above its low on April 7, 2025
* The S&P/TSX Composite is down 0.5% in the past 5 days and rose 1.7% in the past 30 days
* S&P/TSX Composite is trading at a price-to-earnings ratio of 21.4 on a trailing basis and 18.7 times estimated earnings of its members for the coming year
* The index’s dividend yield is 2.4% on a trailing 12-month basis
* S&P/TSX Composite’s members have a total market capitalization of C$4.85t
* 30-day price volatility little changed to 12.60% compared with 12.61% in the previous session and the average of 9.35% over the past month

Index Points
Materials | -152.9644| -3.1| 6/44
Industrials | -18.5848| -0.5| 13/15
Utilities | -4.7270| -0.4| 3/11
Consumer Staples | -3.7940| -0.4| 4/7
Communication Services| -3.6234| -0.6| 1/4
Consumer Discretionary| -1.6542| -0.2| 5/4
Real Estate | -0.4637| -0.1| 9/9
Health Care | -0.3365| -0.4| 0/4
Energy | 6.6018| 0.1| 20/19
Information Technology| 42.1807| 1.3| 8/1
Financials | 60.2012| 0.6| 19/5
Agnico Eagle Mines | Ltd | -40.3900| -5.0| 203.6| 93.0
Wheaton Precious | Metals | -16.7800| -3.9| 38.8| 63.3
Kinross Gold | -14.0100| -4.9| -18.9| 138.7
TD Bank | 10.9000| 0.8| -44.0| 49.3
Brookfield Corp | 11.4500| 1.2| -17.0| 18.8
Shopify | 26.0000| 1.3| 23.1| 60.3
(MT Newswires)
The resources-heavy Toronto Stock Exchange fell for the first session in four Monday on deflating commodity prices and an expectation that while the Bank of Canada will cut its benchmark interest rate again on Wednesday, it is uncertain where rates and the economy will go from there until at least after the federal government delivers its long awaited budget on November 4.
The S&P/TSX Composite Index closed down 77.31 points, or 0.25%, to 30,275.76, with sectors pretty mixed.
Decliners were led by Base Metals, down 1.25%.
Gainers were led by Info Tech, up 1.15%.
On economics, Royce Mendes, Head of Macro Strategy at Desjardins noted that even after seeing a much hotter than expected inflation print, market participants are still betting the BoC will reduce rates by another 25 basis points this week.
"That makes sense," he said, adding: "A careful review of the latest CPI data left us sanguine about the outlook for low and stable consumer price growth in Canada.
We continue to see the central bank eventually taking its policy rate down to 2.00% to support the struggling economy, with a balanced risk assessment about whether rates settle a little higher or a little lower than that point estimate."
On ‘Theory vs. Reality’, Mendes noted BoC Governor Tiff Macklem is particularly worried that the costs of trade disruptions and reconfigured supply chains could translate into higher inflation for goods.
But, Mendes said, there’s little evidence to suggest that risk is materializing.
By all accounts, he added, the underlying trend in goods price inflation is in line with historical averages.
While price growth looks elevated according to the trimmed mean goods measure, the three-month annualized rates of goods prices excluding food and energy and median goods prices are both running roughly 0.5% below their long-term averages, Mendes noted. "As a result," he said, "Macklem’s theory remains just that, a theory."
Mendes added: "The reality is that the economy is in need of support.
Outside of the pandemic, the unemployment rate is standing at its highest level since 2016, pushing wage growth into a lower gear.
The October Monetary Policy Report (MPR) is likely to find that the output gap remains wide and the economic outlook is unlikely to be raised very much from the current tariff scenario in the July MPR.
That’s particularly true since, by convention, the central bank won’t account for much of the forthcoming fiscal stimulus."
On ‘This Week And Beyond’, Mendes said in assuming the BoC does cut its policy rate by another 25 basis points to 2.25%, the focus will shift to the central bank’s communications.
He noted market pricing seems well positioned for a range of outcomes this week.
With traders only pricing in an additional 15-17 basis points of easing over and above a quarter-point cut this week, Mendes said the market might not sell off too much if central bankers sound hawkish about the prospects of further monetary easing.
"With so much uncertainty, it would be difficult for monetary policymakers to credibly rule out more cuts.
However, if policymakers leave the door open to further rate reductions, the market might not rally very much with the federal budget looming less than a week later," he added.
Despite all of the uncertainty, Desjardins’ longstanding view that the BoC will ultimately need to reduce its policy rate down to 2.00% remains intact.
While fiscal policy will eventually provide a strong tailwind to growth, most of those dollars won’t hit the economy until the middle of 2026, Mendes said.
Mendes said: "Back in 2023, when we first predicted that rates would fall to 3.25% by the end of 2024 and to 2.25% by the end of 2025, we were convinced that the market was mispriced.
The Bank of Canada had just raised its policy rate to 5.00% and traders were bracing for more hikes.
It was clear to us, though, that the economy faced severe cyclical and structural headwinds.
Population growth was very likely to slow, mortgage renewals were looming over the housing market and the malaise in productivity showed no signs of abating.
Since then, US tariffs have driven us to lower that terminal rate forecast by another 25 basis points to our current projection of 2.00%."
He added: "Two years and 250 basis points later, however, it’s becoming clear that the job of monetary policy is nearly done.
As fiscal policy takes over, it will eventually become evident that the case for monetary stimulus is less convincing.
Fiscal policy and structural reforms are likely to lead the way in 2026. For the next few months, though, monetary policy is still the only game in town and central bankers will need to do a little more before passing the baton."
Elsewhere, David Doyle, head of economics at Macquarie Group, said Macquarie’s base case is for another 25 bps cut in the policy rate to 2.25%.
Doyle said markets are now pricing this in with an 85% probability, and any forward guidance is likely to be non-committal on the likelihood of further easing.
Doyle said: "The market reaction is likely to be driven by the tone of the statement, Governor Macklem’s press conference, and the contents of the monetary policy report with the return of a baseline forecast.
While our base case is that this will mark the final cut, risks lie in the direction of further easing with another 25 bps cut possible in either December or January."
Of commodities, gold was sharply lower late afternoon on Monday, falling more than 3% as a framework trade deal between China and the United States eased safe-haven buying.
Gold for December delivery was last see down $131.50 to US$4,006.30 per ounce, the lowest since Oct.10.
Also, West Texas Intermediate closed with a small loss on Monday amid hopes for rising global growth after China and the United States reached a preliminary trade deal ahead of a meeting between U.S. President Donald Trump and China President Xi Jinping, offsetting concerns over rising global inventories.
WTI crude oil for December delivery closed down $0.19 to settle at US$61.31 per barrel, while December Brent crude was last seen down $0.41 to US$65.53.
US

By Rita Nazareth
(Bloomberg) — Wall Street’s hopes the US and China are nearing a trade deal lifted riskier assets, with stocks hitting all-time highs amid a rally in crypto.
As demand for safety waned, gold fell alongside short-term bonds.
The S&P 500 climbed 1.2% as Chinese and US trade negotiators have lined up an array of diplomatic wins for Donald Trump and Xi Jinping to unveil at a summit this week.
With further Federal Reserve interest-rate cuts on the way, the profit outlook is looking increasingly brighter.
“The market is on fire,” said Louis Navellier at Navellier & Associates.
“This reflects strong optimism about future earnings potential.
Today’s catalyst is the news that negotiations with China over tariffs are expected to go well. Needless to say, the trend is our friend.”
Corporate America appears fairly unscathed by tariffs, with firms protecting margins through price hikes and cost cuts.
Sales beats for S&P 500 companies are running at a four-year high.
On Wednesday and Thursday, five firms that account for about a quarter of the US benchmark — Microsoft Corp., Alphabet Inc., Meta Platforms Inc., Amazon.com Inc. and Apple Inc. — will report results.
A gauge of the “Magnificent Seven” megacaps jumped 2.6%.
“With the Fed on track to cut rates, extending the run would appear to hinge on this week’s lineup of high-profile earnings releases,” said Chris Larkin at E*Trade from Morgan Stanley.
“And it may, barring any surprises in US-China trade negotiations.”
The S&P 500 topped 6,875 – notching its best three-day rally since May.
While most major groups gained, breadth was not amazing.
“Ultimately advances need breadth to sustain themselves,” said Jonathan Krinsky at BTIG.
Treasury two-year yields rose two basis points to 3.5%.
The dollar fell.
Gold broke below $4,000.
Trump told reporters on Monday that “I really feel good” about a deal with China, after officials unveiled a slew of agreements to ease tensions.
While markets cheered the latest developments, some analysts cautioned the deal now teed up for Trump and Xi to sign in South Korea ignored thorny issues.
Fundamental fights over national security appeared untouched, they said, along with Trump’s stated core mission of rebalancing trade.
Making that harder, Chinese investment into America remains heavily restricted.
“While these developments have lifted market spirits, analysts remain skeptical that the underlying issues — such as national security and tech competition — will be fully resolved,” said Fawad Razaqzada at City Index and Forex.com.
“Nevertheless, traders have embraced the risk-on mood.”
To Mark Hackett at Nationwide, tailwinds for equity markets are significant, with technicals intersecting with fundamentals as risks fade.
“Moving forward, a cascade of tailwinds will support markets in coming months, including strong seasonality, resolution of trade disputes, fiscal stimulus, and easing monetary policy,” he said.
This earnings season is standing out as analysts had set the bar higher by raising projections heading into it.
Robust earnings and signs of sustained investment in artificial intelligence are countering threats to stocks from trade headlines and the government shutdown.
“With companies having reported strong third-quarter results so far amid a favorable backdrop, we expect US stocks to rally further in the coming months,” said Ulrike Hoffmann- Burchardi at UBS Global Wealth Management.
“So, we maintain our attractive view on US equities, forecasting the S&P 500 to reach 7,300 by June 2026.”
Microsoft, Alphabet, Amazon and Meta are projected to post a combined $360 billion in capital expenditures in their current fiscal years, much of it related to AI.
That spending is expected to jump to nearly $420 billion next year, according to analyst estimates compiled by Bloomberg.
“We expect another strong round of megacap tech earnings reports, given the relentless demand for AI technology and infrastructure,” saidClark Bellin at Bellwether Wealth.
“While profitability in AI remains an unknown, investors right now are willing to overlook this as the AI arms race heats up.”
As champions of the tech-driven bull run, quarterly earnings from the Magnificent Seven this week can help investors decipher whether artificial intelligence hype is masking a bubble, according to Hardika Singh at Fundstrat Global Advisors.
“But for me, those concerns in and of themselves aren’t enough to run for the hills,” Singh noted.
“AI is transforming every single industry, and as I keep repeating, we’re literally in such early innings for this secular cycle that being worried about valuations and froth would be short-sighted.”
To Matt Maley at Miller Tabak, the most-important issue will be the comments about the future rate of spending on AI from the hyperscalers.
“Expectations are very high on this front, so there are some risks involved,” he said.
“However, since there haven’t been any signals that these companies will back off on their spending, these high expectations seem to be well placed.”
“Our view remains firmly risk-on into 2026, with our base case for a further melt-up in risk assets in the coming months,” said Max Kettner at HSBC.
Among the various catalysts, he cited: further signs of US growth resilience, subdued sentiment and positioning as well as liquidity tailwinds with an end to quantitative tightening and perhaps even more Fed liquidity support to avert a year-end funding squeeze.
Equity analysts are expected to broaden their earnings revisions to more stocks toward the end of the year and into 2026, according to Morgan Stanley strategists.
“We have high conviction in our rolling recovery thesis, which remains out of consensus,” the team led by Michael Wilson wrote.
The third-quarter earnings season has proved stronger than expected and could deliver results beyond what analysts expected prior to “Liberation Day” in April, according to Deutsche BankAG strategists led by Binky Chadha.
Meantime, hedge funds turned net buyers of US equities last week as softer inflation data fueled bets on imminent Fed rate cuts, pushing major indexes to new highs.
The buying was largely driven by short covering rather than fresh long positions, according to Goldman Sachs Prime brokerage desk’s report for the week ending Oct. 24.

Corporate Highlights:
* Qualcomm Inc. soared after unveiling chips and computers for the lucrative AI data center market, aiming to challenge Nvidia Corp. in the fastest-growing part of the industry.
* Amazon.com Inc. plans to cut corporate jobs in several key departments, including logistics, payments, video games and the cloud-computing unit, according to people familiar with the matter.
** The terminations, expected as soon as Tuesday, could affect as many as 30,000 jobs, Reuters reported on Monday, citing sources.
* Nvidia Corp.’s Chief Executive Officer Jensen Huang will deliver his highly anticipated keynote for the first time in Washington at noon on Tuesday.
** Nvidia and Deutsche Telekom AG are preparing to announce plans for a €1 billion data center in Germany as part of a broader push to develop more infrastructure across Europe to power AI systems.
* Meta Platforms Inc. moved its top metaverse executive to oversee AI products following hundreds of job cuts last week, a sign the company is still working to structure its teams even as it spends aggressively to compete in the heated artificial intelligence race.
* Wall Street analysts are now almost universally bullish on Microsoft Corp., with Guggenheim upgrading the software company to buy ahead of its quarterly results.
* Berkshire Hathaway Inc. got a rare sell rating, with analysts cautious on its earnings outlook and ongoing concerns over Warren Buffett’s upcoming departure and macro risks.
* International Business Machines Corp. is launching a digital assets platform to allow financial institutions, governments and companies to launch blockchain-based services, as crypto activity gathers steam.
* Huntington Bancshares Inc. agreed to buy Cadence Bank for $7.4 billion, the Ohio bank’s second major acquisition this year to expand in southern and southeastern states and the latest in a string of deals among US regional lenders.
* American Water Works Co. agreed to buy Essential Utilities Inc. in an all-stock transaction valued at about $12 billion, the biggest water utility deal by total value this century in the US.
* Keurig Dr Pepper Inc. is raising $7 billion from Apollo and KKR to help finance its acquisition of JDE Peet’s NV, aiming to ease investor concerns about taking on too much debt.
** The beverage maker now expects fiscal 2025 constant currency net sales growth to be in high-single-digit range, up from a previous prediction in the mid-single-digits.
* Lululemon Athletica Inc. has entered an arrangement with the National Football League and sports merchandiser Fanatics Inc. to develop a line of fan apparel as the yoga-wear retailer searches for new avenues of growth.
* Johnson & Johnson has seen a 17% jump in new lawsuits claiming its iconic baby powder causes cancer after the company’s latest attempt to force a global settlement was thrown out of bankruptcy court.
* Cigna Group will eliminate prescription drug rebates in many of its commercial health plans in 2027, upending an opaque, controversial practice that’s drawn the ire of President Donald Trump.
* Easterly Government Properties Inc.’s quarterly revenue surged the most in five years, driven by the Trump administration’s focus on law enforcement-spending.
* NextEra Energy Inc. is planning to restart the Duane Arnold nuclear power plant in Iowa, primarily to supply Google data centers, according to a report Monday on Fox Business.
* The chief executive of Organon, the company behind the birth control implant product Nexplanon, has stepped down after an audit committee uncovered improper sales practices related to the medicine.
* UBS Group AG has filed an application for a national bank charter for its US franchise as it seeks to expand in the region.
* Novartis AG agreed to buy Avidity Biosciences Inc. in a $12 billion deal that’s the Swiss drugmaker’s biggest acquisition in more than a decade and adds several potential blockbuster treatments as generic competition looms for its current top- sellers.
* Porsche AG vowed to reverse months of poor performance with a new chief executive officer and changed course on its EV strategy.
* A trio of shareholders in Galderma Group AG led by EQT AB are looking to sell an 8.4% stake in the Swiss skincare company, the latest selldown in a stock that has soared on the back of high demand for beauty products.

Some of the main moves in markets:
Stocks
* The S&P 500 rose 1.2% as of 4 p.m. New York time
* The Nasdaq 100 rose 1.8%
* The Dow Jones Industrial Average rose 0.7%
* The MSCI World Index rose 1.1%
* Bloomberg Magnificent 7 Total Return Index rose 2.6%
* The Russell 2000 Index rose 0.3%
Currencies
* The Bloomberg Dollar Spot Index fell 0.1%
* The euro rose 0.2% to $1.1645
* The British pound rose 0.2% to $1.3334
* The Japanese yen was little changed at 152.89 per dollar
* The Mexican peso rose 0.3% to 18.3963
Cryptocurrencies
* Bitcoin rose 1.3% to $114,800.73
* Ether rose 2.5% to $4,163.48
Bonds
* The yield on 10-year Treasuries declined one basis point to 3.99%
* Germany’s 10-year yield declined one basis point to 2.62%
* Britain’s 10-year yield declined three basis points to 4.40%
* The yield on 2-year Treasuries advanced two basis points to 3.50%
* The yield on 30-year Treasuries declined three basis points to 4.56%
Commodities
* West Texas Intermediate crude fell 0.1% to $61.41 a barrel
* Spot gold fell 3% to $3,989.70 an ounce

Have a lovely evening.

Be magnificent!

As ever,

Shima

"In photography, the smallest thing can be a great subject. The little, human detail can become a Leitmotiv."– Henri Cartier-Bresson

Shima Zangeneh

Assistant to Carolann Steinhoff

Queensbury Securities Inc.

340A – 730 View Street

Victoria BC V8W 3Y7

Tel: 778-430-5851

Fax: 778-430-5828