Market Quick Take – 1 October 2025

Market drivers and catalysts

• Equities: A positive close yesterday in US, but futures lower overnight on US government shutdown.
• Volatility: Mildly higher yesterday and rising overnight as US equity futures trad lower
• Digital Assets: Bitcoin steady , while Ethereum has chopped a bit lower.
• Currencies: US dollar weakens slightly against JPY and EUR. AUD lower.
• Commodities: Corn slumps on bulging stocks. Gold hit fresh record following short-lived correction
• Fixed Income: Japan’s short yields reach new cycle high on Tankan survey, US yields unchanged as US government set to shut down
• Macro events: US Sept. ADP Employment, Manufacturing PMI & ISM Manufacturing

Macro headlines

• The US government is heading towards a shutdown as Democrats stopped a Republican stopgap funding package on a confrontation over health-care spending. As many as 750,000 federal workers could be temporarily furloughed, even if Trump doesn’t proceed with permanent dismissals, the nonpartisan Congressional Budget Office estimated.
• Japan's Q3 Tankan Survey out overnight showed manufacturing improving for a second quarter and capex plans surprised on the upside, while services stayed very strong—netting a solid report that keeps BOJ October hike odds alive.
• US job openings rose by 19,000 to 7.227 million in August 2025, matching expectations. Gains occurred in health care, hospitality, and retail, while construction and federal positions decreased. Openings increased in the South and Midwest but fell in the Northeast and West. Hires and separations remained stable at 5.1 million.
• US consumer confidence fell in September to a five-month low amid rising concerns over jobs and the economy. The Conference Board index dropped 3.6 points to 94.2, below the 96 consensus. The present situation measure fell 7 points to a one-year low, while six-month expectations also declined.
• In July 2025, the S&P CoreLogic Case-Shiller 20-City Home Price Index rose 1.8% year-on-year, marking the smallest increase since July 2023, after a 2.2% rise in June, and surpassing the 1.6% forecast. New York led with a 6.4% gain, followed by Chicago (6.2%) and Cleveland (4.5%), with Boston and Detroit also seeing solid increases.
• Germany’s annual inflation rate increased to 2.4% in September 2025, up from 2.2% in August and above the 2.3% forecast. This is the highest rate this year, with prices for goods and services accelerating. Energy and food inflation eased slightly, while core inflation rose to 2.8%. Monthly consumer prices rose by 0.2%, with the EU-harmonised CPI also increasing by 2.4% year-on-year and 0.2% month-on-month.

Macro calendar highlights (times in GMT)

• Thursday: Tesco PLC

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

US: After a positive session on Wall Street, futures turned lower overnight as the US government is set to shut down today. Yesterday, the Dow notched a record close (+0.2%), with the S&P 500 (+0.4%) and Nasdaq 100 (+0.3%) higher into the shutdown deadline; September marked another up month for all three. Healthcare led after a White House–Pfizer drug-pricing deal sparked a broad pharma rally (Pfizer +6.8%, peers bid). AI/megacap tech firmed (Nvidia up +2.6%) while cyclicals were mixed. After hours, Nike popped 4% on a clean Q1 beat and constructive guidance.

Europe: The STOXX 600 reversed early losses to finish +0.5%—media and retail outperformed, while energy lagged on softer oil and OPEC+ supply chatter. Lufthansa −7.1% after a pilots’ strike vote; Puma +4.6% on an upgrade; TotalEnergies/BP −1%+ with the sector. FTSE 100 saw an intraday record.

Asia: Hong Kong and mainland Chinese exchanges closed for Golden Week celebration, with mainland China not opening again until Thursday, October 9. Japan’s market fell sharply overnight on aftermarket weakness in the US on the government shutdown there, with a stronger Japanese yen adding to downward pressure.

Volatility

• Volatility rose slightly ahead of the US government shutdown risk, which has now been realized. The VIX closed yesterday at 16.3, up slightly from the day before despite the positive close for stocks on the day. The MOVE index of US Treasury market volatility picked up sharply, rising 2.42 points to 77.93, a 14-trading day high.

Digital Assets

• Bitcoin chopped a bit lower yesterday but managed to recover to around unchanged at 114.6k this morning, while Ethereum has slipped a bit more, trading 4,151 this morning after the 4,246 high yesterday.

Fixed Income

• US treasury yields fell yesterday, but rebounded close to unchanged on the session for both 2-year and 10-year benchmarks ahead of the US government shutdown that has now been realized overnight.
• Japan’s government bond yields rose at the front end of the yield curve, with the benchmark 2-year JGB posting a new high for the cycle at 0.967% after the Q3 Tankan Survey saw firming confidence, but eased back to 0.953% later in the session, just under 1 basis point higher than the previous day’s close. The benchmark 10-year JGB yield chopped around, but remained within the recent range near the post-GFC cycle highs.

Commodities   

• Corn futures in Chicago slumped 1.8% to a one-month low after the USDA’s Quarterly Grain Stocks report showed U.S. corn supplies swelling to 1.53 billion bushels, about 15% above trade expectations. Soybeans (-1.6%) and wheat (-2.5%) also retreated, with December CBOT wheat sliding to a new contract low.
• Precious metals attempted a correction on month-end position squaring and the start of China’s eight-day Golden Week holiday, but the move quickly reversed as fresh buying lifted gold to a new record high. Support came from continued U.S. government shutdown jitters and a softer dollar. The failed correction underlines the strength of the prevailing “buy-the-dip” mentality among traders and investors.
• Crude futures steadied after a two-day decline sparked by speculation that OPEC+ may consider fast-tracking its next round of supply hikes, potentially adding 500,000 barrels per day in three monthly steps to unwind previous cuts. Ahead of the EIA’s weekly report, the API estimated a 3.7 million-barrel draw in U.S. crude stocks, though product inventories rose.

Currencies

• The US dollar weakened a bit further as the US government shutdown overnight for an unknown duration. USDJPY traded as low as 147.46 overnight and EURUSD as high as 1.1767.
• The Australian dollar had its wings clipped as it traded lower versus the NZD overnight after posting the highest level in almost three years at 1.1418 yesterday, trading 1.1380 this morning. China announced yesterday that it is forbidding companies from loading iron ore cargoes from Australian mining giant BHP until further notice.