September 2025 Market Commentary

September 2025 was a month where central banks finally blinked—and markets responded with a confident stride. The S&P 500 climbed from 6,460 to 6,688, while the S&P/TSX Composite surged from 28,564 to 30,022, a robust 5.11% gain. The TSX’s year-to-date performance now stands at +25.09%, a testament to the strength of Canadian equities despite trade headwinds and global uncertainty. Investors leaned into fundamentals, and the results speak for themselves.

The Fed finally tapped the brakes, trimming rates by 25 basis points to 4.00%–4.25% as inflation lingered and the labor market cooled. The Bank of Canada followed with a cut to 2.5% amid weak GDP and trade drag. Markets didn’t panic—they pivoted. Stocks climbed, yields dipped, and gold sparkled. This wasn’t a fire drill; it was a finely tuned recalibration. President Trump slammed the Fed for moving too slowly, while Prime Minister Carney quietly shelved retaliatory tariffs and toned down the nationalism that helped him win office. Diplomacy by subtraction—and markets approved.

Earnings season added fuel to the rally. Tech leaders like Micron, Meta, and Amazon delivered strong results, powered by AI demand and cloud growth—even as tariff concerns lingered. Consumer names were mixed: Nike showed signs of fatigue, while Carnival cruised past expectations. Financials like Paychex and Jefferies held steady. On the Canadian side, Shopify surged on new AI integrations, Teck Resources rallied on strong metals demand, and Celestica continued its breakout year, topping the TSX30 with an impressive YTD performance of 154.06%.

Despite lofty valuations, the economic backdrop remains more misty than stormy. With rate cuts in motion, inflation cooling, and consumers still spending, the fourth quarter may offer more than just seasonal cheer. For investors anchored in quality and discipline, the climb may be just beginning.

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