Watch Mike’s video here, or read on for the full story.
Defying expectations
October defied the odds - and the statisticians. Historically, it’s one of the weakest months for markets, a time when volatility often creeps in and sentiment turns cautious. Add in the threat of a US government shutdown, ongoing geopolitical uncertainty, and renewed US-China trade tensions, and you’d think the bulls might have finally paused for breath.
But instead, they kept running.
October marked the seventh consecutive month of global gains, an extraordinary streak that underscores just how resilient investors have been in the face of uncertainty. It’s been a great time to be an investor - proof that sometimes the market does the opposite of what the data (and the headlines) would have you believe.
Gold fever and a front-row seat
The month began with a rare moment of calm in the Middle East - a US-brokered ceasefire between Gaza/Hamas and Israel. It triggered a rush into traditional safe-haven assets like gold, which spiked sharply in early October.
During a trip to Sydney that week, I happened to wander through Martin Place and couldn’t help noticing a long queue snaking out of a bullion dealer’s door. Dozens of people were waiting patiently to buy physical gold - a vivid reminder of how emotional markets can become, and how quickly euphoria takes hold when fear and greed collide.
It was one of those “you had to see it” moments - and a good reality check that even in a bullish market, investor psychology remains as powerful as ever.
The unstoppable AI boom
If there’s one theme that continues to dominate 2025, it’s artificial intelligence (AI). The AI boom has not just persisted - it’s accelerating. Major US tech companies announced another wave of capital spending on AI infrastructure during October, driving the next phase of growth in data centres, chips and cloud capacity.
NVIDIA made headlines again, becoming the first chipmaker to break the US$5 trillion market cap barrier. The sheer scale of investment underway reminds me of the railroad expansion of the 19th century - a network being built at breathtaking speed, laying the tracks for decades of future productivity gains.
This isn’t a flash in the pan. It’s an industrial revolution in motion, and it’s fuelling the US economy - and by extension, global equity markets.
Politics, policy and the “TACO trade”
Elsewhere, the usual political theatre continued. The US government technically entered a shutdown in early October, but markets largely shrugged. Investors seem to have learned that these episodes tend to end the same way — with a deal struck before any lasting damage is done.
Closer to home, both the Federal Reserve and the RBNZ cut rates during the month. It’s welcome news for borrowers, but we’re not yet in the realm of truly stimulatory policy. Rates are lower, but they’re still above long-term neutral levels - meaning the economic engine is easing off the brakes, not hitting the accelerator.
And then there was the latest chapter in the ongoing US–China trade saga. Rhetoric flared up early in the month, only to fade as quickly as it arrived. The saying - the “TACO trade” (Trump Always Chickens Out) - proved true once again. By late October, a framework for compromise had emerged, including tariff cuts, rare-earth agreements and relaxed export controls. Markets welcomed the news, and optimism surged heading into month-end.
A standout month for Pie Funds
While all of this was unfolding globally, Pie Funds investors had plenty to smile about. Our Australasian Emerging Companies Fund was our top performing fund in October, up 6.5% for the month. Together with a return of 20.3% p.a. since inception in 2013, this is an outstanding achievement for our Australasian investment team.
Looking toward year-end
With a strong US earnings season behind us and investor sentiment holding firm, the question now is whether markets will chase the rally into Christmas, or whether late 2025 will bring the kind of seasonal cooling we’ve historically seen after long runs.
Either way, I’m optimistic. The structural tailwinds - from AI innovation to easing rates - remain firmly in place. And as always, our focus at Pie Funds is to stay disciplined, find value, and back companies with sustainable growth potential.
Join us at our November investor update events
Until then, thanks for continuing your investing journey with us.
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