Recent developments in the economy and markets highlight a mix of uncertainty and opportunity. With the government shutdown limiting official data releases, the Federal Reserve and market participants are relying on alternative indicators to gauge economic health. Meanwhile, global monetary policy, tariff impacts, and shifting inflation trends are influencing both equity and fixed-income markets. If you’re wondering what this means for your portfolio, the key takeaways below break down certain trends and what they may signal for investors. 

Economic & Policy Environment

  • Data Vacuum: Government shutdown has stalled official economic data releases, leaving the markets and the Fed “flying blind.” Private-sector surveys suggest labor markets remain stable but show signs of softening.
  • Tariffs & Monetary Policy: Research from the Minneapolis Fed suggests tariffs are contractionary; optimal policy response is rate cuts to support growth despite short-term inflation bumps.
  • Fed Outlook: October rate cut reflects a shift in the balance of risks toward growth over inflation. Markets price in ~60% chance of another cut in December with one cut expected through the end of Q12026. Leadership change at the Fed in May adds uncertainty.

Inflation & Global Trends

  • U.S. CPI: Latest print (Sept) shows headline and core inflation at 3%, above the Fed’s 2% target.
  • Global Inflation: Developed markets have stabilized near 2%, while China faces deflationary pressures—opposite of global trends.

Fixed-Income Markets

  • Yield Curve: Steep curve persists; 2 year yields ~3.6%, 30 year ~4.6%. Longer maturities now offer higher yields than last year.
  • Emerging Market Debt: Strong performer, up 13% YTD, driven by Latin American issuance.

Equity Markets

  • Performance: U.S. large caps up 17.5% YTD; developed international up 26.6%; emerging markets lead at 33%, with strength in Asia.
  • Sector Trends: Growth names dominate; “Magnificent 7” driving U.S. equity gains. Small caps show recovery (+12.4% YTD).

Portfolio Dynamics

  • Correlation: Equities and fixed income show near-zero correlation (~5%) over past six months—favorable for diversification.
  • Currency & Volatility: USD down ~10% vs. basket of currencies; VIX at 17.7 (slightly elevated but contained). Interest rate volatility trending lower.

Market Observations as of 11/10/2025, subject to change and not to be used, or interpreted, as a recommendation.

IMPORTANT INFORMATION

Definitions:

  • S&P 500 Index is a weighted index of common stocks of 500 leading companies in leading industries of the U.S. economy, capturing 75% coverage of U.S. equities. The index is capitalization weighted, thereby giving greater weight to companies with the largest market capitalizations.
  • Russell 1000® Growth Index measures the performance of those Russell 1000® Index companies with higher price-to-book ratios and higher forecasted growth values. It is market-capitalization weighted.
  • A basis point (BPS) is a unit of measure used to indicate percentage changes in financial instruments. Basis points are typically expressed with the abbreviations "bp," "bps," or "bips." One basis point is equal to 1/100th of 1%, or 0.01%. In decimal form, one basis point appears as 0.0001 (0.01/100).

Information provided in this newsletter is general in nature, is provided for informational purposes only and should not be construed as investment advice. The views and opinions expressed are those of the author(s) as of the stated date of their contribution and any such views and opinions are subject to change at any time based on market, or other conditions, and are not intended to be a forecast of future events, a guarantee of future results or investment advice. Securities and sectors referenced should not be construed as a solicitation or recommendation, or be used as the sole basis for any investment decision.

All investments contain risk and may lose value. Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these investment strategies will work under all market conditions or are appropriate for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Outlook and strategies are subject to change without notice.

Past performance is not a guarantee of future results. Portfolio rebalancing and diversification do not guarantee a profit or protection against loss in a declining market.

No guarantee or representation is made that investment objectives and/or opinions stated will be achieved. The experience of each specific client or investor may vary.

Due to the subjective aspect of these analyses, the effective evolution of the economic variables and values of the financial markets could be significantly different from the projections, forecasts, anticipations and hypotheses, which are communicated in this material.

Quick Takes feature commentary from subadvisors of investment portfolios that are available through model portfolios, mutual funds, variable life insurance policies and variable annuity contracts issued by Equitable Financial Life Insurance Company of America (Equitable America) (AZ stock company) with an administrative office located in Charlotte, NC, and Equitable Financial Life Insurance Company (Equitable Financial) (NY, NY), and mutual fund products. Variable annuities and variable life insurance products are co-distributed through Equitable Advisors, LLC (member FINRA, SIPC) (Equitable Financial Advisors in MI and TN) and Equitable Distributors, LLC.

Equitable Investment Management Group, LLC (EIMG) is a wholly-owned subsidiary of Equitable Financial, which is an indirect, wholly-owned subsidiary of Equitable Holdings, Inc. Equitable Investment Management, LLC (EIM LLC) is an indirect, wholly-owned subsidiary of Equitable Holdings, Inc. EIMG and EIM LLC are affiliates of Equitable Advisors and AllianceBernstein L.P ("AB"). References to "Equitable Investment Management" include EIMG, and its affiliate, EIM LLC, unless otherwise stated.

1290 Funds is part of the family of mutual funds advised by Equitable Investment Management Group, LLC (EIM). EIM is a wholly owned subsidiary of Equitable Financial Life Insurance Company (Equitable Financial), NY, NY. Equitable Distributors, LLC is the wholesale distributor of the 1290 Funds. Equitable Advisors, LLC (member FINRA, SIPC) (Equitable Financial Advisors in MI and TN) offers 1290 Funds to retail investors. The Funds are distributed by ALPS Distributors, Inc., which is not affiliated with EIM, Equitable Financial Life Insurance Company, Equitable Distributors, LLC, Equitable Advisors, LLC (member FINRA, SIPC) (Equitable Financial Advisors in MI and TN) or the subadvisors.

Model portfolios are made available to clients of financial intermediaries, including Equitable Advisors, through LPL Financial's Model Wealth Portfolio (MWP) program on a non-discretionary basis by Equitable Investment Management.

An investor should consider investment objectives, risks, charges and expenses carefully before investing. Obtain a copy of the prospectus at 1290funds.com, which contains this and other information, or call (888) 310-0416.

Read the prospectus carefully before investing. Please consider the charges, risks, expenses and investment objectives carefully before purchasing a variable life insurance policy, mutual fund or variable annuity. For a prospectus containing this and other information, please contact a financial professional or visit equitable.com. Please read the prospectus carefully before you invest or send money.

Variable Life Insurance, Variable Annuities and Mutual Funds: • Are Not Deposits of Any Bank • Are Not FDIC Insured • Are Not Insured by Any Federal Government Agency • Are Not Bank Guaranteed • May Go Down in Value

© 2025 Equitable Holdings, Inc. All rights reserved. 

GE-8602567.1 (11/2025) (Exp. 11/2029)