Market Quick Take – 2 October 2025

Market drivers and catalysts

Equities: Wall Street extended gains as healthcare and big tech drove fresh records; Europe advanced with pharma strong and defence weaker; Asia opened higher after AI-chip strength lifted Korea and Hong Kong.
Volatility: VIX stays subdued as stocks notch fresh highs, but the US shutdown and today’s jobless claims keep event risk alive.
Digital Assets: Crypto holds firm into Europe’s open as ETF demand and a softer dollar backdrop support bitcoin and ether; majors trade steady.
Currencies: USD rebounds from ugly ADP payrolls dataCommodities: Gold resilient, crude slips on OPEC+ talk, soybeans caught in US-China standoff
Fixed Income: US yields drop sharply on ugly ADP payrolls data
Macro events: No US data due to government shutdown. Eurozone Unemployment

Macro headlines

• The US Supreme Court's refusal to allow Trump to immediately oust Fed Governor Lisa Cook has eased pressure on the central bank after months of criticism from the White House. The order means Cook can remain at her post at least until the justices rule after hearing arguments in the case in January.
• US manufacturing shrank for a seventh straight month in September as orders softened. The ISM factory index rose 0.4 points to 49.1, still signalling contraction and remaining stuck in a narrow range this year.
• ADP said US private payrolls fell by 32,000 in September, after a revised 3,000 drop in August (vs. the original , missing all forecasts and partly reflecting data‑analysis issues. ADP periodically recalibrates to the Bureau of Labor Statistics series; the latest benchmark revision reduced September by 43,000 compared with pre‑benchmarked data.
• The European Commission said it is planning on reducing foreign steel quotas by almost half and will increase tariffs by up to 50% on Chinese steel in line with US and Canadian partners.
• Fitch Ratings stated the US government shutdown likely won't impact its sovereign rating soon, while S&P Global Ratings sees shutdowns as having minor economic effects. Fitch expects the deficit to narrow to 6.8% of GDP in 2025, boosted by $300 billion in tariff revenues. S&P cautions prolonged shutdowns could reduce GDP growth by 0.1%-0.2% weekly due to secondary effects.
• The S&P Global Canada Manufacturing PMI fell to 47.7 in September 2025 from 48.3 in August, marking eight months of contraction due to US tariffs and Canada's retaliatory measures.
• Euro area consumer inflation rose to 2.2% in September 2025, up from 2.0%, surpassing the ECB's 2.0% target. The rise was mainly due to a smaller energy cost decline of 0.4% compared to August's 2%. Services inflation increased to 3.2%, while food, alcohol, and tobacco inflation slowed to 3.0%. Non-energy goods inflation stayed at 0.8%. Core inflation remained stable at 2.3%.

Macro calendar highlights (times in GMT)

• Today: Tesco PLC

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

Equities

• USA: The S&P 500 rose 0.3% and the Nasdaq 100 0.5%, adding a fourth straight advance as investors looked past the federal shutdown and leaned into easing-labour data that support rate-cut expectations. Healthcare led on optimism around US drug-pricing talks, while megacap tech provided a steady tailwind; Treasuries rallied and gold set another record as the data blackout looms. Tesla and Nvidia were among notable gainers in the session’s tech bid, while the Dow finished little changed. Focus turns to private payroll and claims series in the absence of Friday’s official jobs report.
• Europe: European equities closed broadly higher, with the Stoxx 600 up 1.2% as pharma outperformed and investors monitored the US shutdown’s data implications. AstraZeneca jumped 11.2% amid renewed listing chatter, Roche gained 8.6%, Novo Nordisk rose 6.4% and Zealand Pharma added 7.4%, while defence names lagged with Renk down 4.2% and Hensoldt off 3.0%. Euro-area inflation printed 2.2% year on year and UK house prices rose 2.2%, reinforcing the view that Europe’s disinflation continues even as growth remains patchy.
• Asia: Asian equities rose in the prior session, led by Korea where Samsung climbed 4.5% and SK Hynix surged 11.0% on AI demand, while Hong Kong’s Hang Seng gained 1.5% and Australia’s ASX 200 added 1.3%. The upbeat tone carried into today’s open, with regional tech still in focus as investors weigh the spillover from AI-infrastructure momentum and prepare for US data delays during the shutdown.

Volatility

• VIX closed at 16.3 as equities shrugged off Day 2 of the US government shutdown. The immediate driver is the data calendar: weekly jobless claims are still scheduled, but the broader shutdown raises the risk of a rolling “data blackout” that can amplify swings. A softer dollar and record-high gold temper stress for now. Options imply today’s S&P 500 move around ±1.0% (about ±69 points).

Digital Assets

• Bitcoin trades near USD 118,500 and ether around USD 4,390 after mid-week gains, supported by shutdown-era dollar softness and steady risk appetite. US spot ETFs remain a strong tailwind, with IBIT and ETHA together drawing over USD 360m in fresh inflows across the last two sessions. Alt-coins are steady, with Solana holding in the low USD 220s and XRP near USD 3.

Fixed Income

• US treasury yields dropped sharply yesterday on the release of the September ADP payrolls change report and steep negative revision to the August payrolls numbers as well as this points to higher likelihood of Fed easing and a slowing economy. The benchmark 2-year yield fell almost seven basis points to close at 3.54% as the market raised the likelihood of two more rate reductions this year and the benchmark 10-year yield fell five basis points to close at 4.10%.
• Japan’s government bond yields were mostly steady near the highs of the cycle, with the benchmark 10-year trading this morning higher at 1.66%, which if maintained would be the highest daily close since 2008, but is not the highest intraday level which is a basis point higher. A 10-year JGB auction overnight saw weaker demand than the previous auction ahead of this Saturday’s LDP leadership vote that will determine the next Prime Minister.

Commodities

• Brent crude slid to USD 65 after a three-day tumble, pressured by speculation OPEC+ could accelerate output hikes in November, alongside rising US crude inventories and US gasoline demand dropping to a six-month low. The alliance, which meets on Sunday, has denied such plans, but several major forecasters still expect an oversupplied market to drive prices lower in 2026.
• Gold reached a fresh record on Wednesday, supported by US government shutdown jitters and renewed inflows at the start of the month, despite the absence of Chinese traders during the Golden Week holiday. While calls for consolidation are building, ETF demand remains strong, with 150 tons added since Powell’s dovish shift at Jackson Hole in August helping fuel the latest 16% rally.
• Soybean futures rose after Trump pledged to confront Chinese President Xi Jinping at the upcoming Asia-Pacific Economic Cooperation summit over Beijing’s refusal to purchase US soybeans. Pressure is mounting on Republican Senators as farmers struggle, while data shows China had not booked a single cargo as of September 18—a first in records dating back to 1999.

Currencies

• The US dollar weakened sharply yesterday on the back of the weak ADP payrolls data, but managed to bounce back from new local lows. EURUSD traded as high as 1.1779 before dropping back to as low as 1.1716, trading 1.1736 this morning in Europe. USDJPY bounced back from its steep slide to as low as 146.60 to trade back above 147.00 by later in the session, trading 147.17 this morning in Europe.