Market Quick Take – 17 September 2025

Market drivers and catalysts

• Equities: US slipped ahead of the Fed; Europe fell on bank and insurer weakness; Asia mixed with Japan at records and Hong Kong flat
• Volatility: Fed day, VIX mid-teens, SPX ±45pts, event risk
• Digital Assets: BTC steady $117k, IBIT inflows, ETHA outflows, alts mixed
• Fixed Income: US short treasury yields price more Fed easing
• Currencies: USD weak, especially against resurgent EUR as EURUSD posts new high.
• Commodities: Silver trims rally ahead of FOMC; gold steady
• Macro events: FOMC Rate Decision

Macro headlines

• The FOMC is projected to lower borrowing costs today for the first time in 2025, with a quarter-point reduction being fully priced in. But a cooling labor market has seen traders increasing options wagers that the FOMC will deliver at least one half-point cut at one of the two remaining policy meetings this year.
• US retail sales rose 0.6% in August 2025, beating the forecast of 0.2%. Increases were notable in non-store retailers (2%), clothing (1%), and sporting goods (0.8%). Excluding major categories, sales jumped 0.7%, outperforming expectations of 0.4%. Declines occurred in miscellaneous retailers (-1.1%).
• Oracle, Silver Lake, and Andreessen Horowitz will become TikTok's new majority owners in the US. Oracle, co-founded by Larry Ellison, is TikTok's cloud provider. Silver Lake and Andreessen Horowitz are investment firms led by billionaires, including Trump adviser Marc Andreessen.
• Canada's annual core inflation, excluding eight volatile items like food, energy, and mortgage interest costs, remained at 2.6%, the same as in July and slightly under the 2.7% market expectation. Month-on-month, core consumer prices were unchanged, after a 0.1% rise in July.
• China revealed measures to boost services consumption, including opening internet and culture sectors and hosting international sports events. Nine agencies aim to attract foreign investment in high-end medical care, support construction of cultural facilities with central and local funds and use monetary policies to expand credit for services.
• US industrial production rose 0.1%, surpassing expectations of a 0.1% decrease after July's revised 0.4% fall. Manufacturing output increased 0.2%, beating forecasts of a 0.2% drop. Mining output grew 0.9%, while utilities fell 2%. Capacity utilization remained at 77.4%, 2.2 points below its long-run average.
• Trump in UK on state visit

Macro calendar highlights (times in GMT)

0600 – UK August CPI
1230 – US August Housing Starts and Building Permits
1345 – Bank of Canada Rate Decision
1430 – EIA's Weekly Crude and Fuel Stock Report
1800 – FOMC Rate Decision
1830 – US Fed Chair Powell Press Conference

Earnings this week

• Today: Exor NV, General Mills
• Thu: FedEx, Lennar, Darden Restaurants, Next PLC

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

Equities

• USA: S&P 500 −0.1%, Dow −0.3% (−125 pts), Nasdaq −0.1% as investors banked profits ahead of the Fed’s September policy meeting. August retail sales rose 0.6% m/m, reinforcing resilient demand even as labor cools. Nvidia −1.6% on China antitrust headlines, Microsoft −1.2% with megacaps easing, while Palantir −0.6%. Oracle +1.5% on reports of a U.S.–China TikTok framework. Focus shifts to Powell’s guidance and the dots.
• Europe: Stocks fell into central-bank risk. STOXX 50 −1.3% and STOXX 600 −1.1%; FTSE 100 −0.9%. Germany’s ZEW sentiment beat, while UK jobs data softened. Financials and defensives lagged: Santander −2.4%, Munich Re −2.7%, Deutsche Börse −2.6%. L’Oréal −2.9% after a Jefferies downgrade. Attention stays on the Fed today and the BoE tomorrow.
• Asia: Prior local closes were mixed. Nikkei 225 +0.3% to a record after breaking 45,000 intraday; Hang Seng closed flat at 26,438 as tech and travel gains offset property and financials; mainland action was subdued. Meituan +4.4% and Trip.com +4.2% led on consumption and travel strength, while Geely +3.1% firmed with EV sentiment. Tencent sold offshore yuan bonds, while China’s Nvidia antitrust move kept chip sentiment in check.

Volatility

• Markets face a key test today as the Fed delivers its rate decision and Powell speaks. Futures imply a 25 bp cut, but the new dot plot and guidance will drive sentiment. The VIX closed at 16.36 (+4.3%) while SPX slipped to 6,606 (−0.13%), pointing to a cautious tape. Short-dated VIX measures surged (VIX1D +80%), showing nerves around the announcement. Fed communication on inflation and tariffs will set the tone for equity and bond volatility. SPX options price an expected move of about ±45 points (±0.67%) for today, leaving room for sharp swings if Powell surprises.

Digital Assets

• Bitcoin trades around $117k, holding recent gains ahead of the Fed. ETFs show diverging flows: IBIT added $209m while ETHA saw outflows (−$20m), giving BTC the relative edge. Ether sits at $4.5k, stable but lagging on weaker ETF demand. Altcoins are mixed: SOL and XRP slipped while meme tokens show speculative interest. Broader support comes from falling BTC exchange reserves and rising stablecoin balances, suggesting dry powder for fresh buying. The Fed’s tone on liquidity and rates will dictate whether crypto extends higher or pauses.

Fixed Income

• US Treasuries were firm all along the curve, with short yields falling a bit more than almost unchanged longer yields as traders raised expectations for a more accommodative Fed. The benchmark 2-year treasury yield closed just over 3 basis points lower near 3.50%, the lowest close in six days ahead of this evening’s FOMC meeting.
• Long Japanese yields fell after an auction of 20-year Japanese Government Bonds saw the strongest demand since 2020. The 20-year yield dropped three basis points to 2.64%, while at the shorter end of the curve, JGB yields were steady near recent highs.

Commodities

• Silver has run into profit-taking ahead of today’s widely anticipated US rate cut, while gold holds near a record after briefly topping USD 3,700 on Tuesday, supported by a softer dollar. Traders remain relaxed about the risk of a short-term “sell the fact” reaction, with the prospect of lower funding costs and strong ETF and Asian demand underpinning prices. Support at USD 3,545 and USD 3,500.
• Brent crude holds a three-day gain on supply worries amid Ukrainian attacks on Russian crude infrastructure and heightened Middle East tensions, but it remains range-bound between USD 65 and 70 as increased OPEC+ supply caps rallies. Meanwhile, the EU is weighing sanctions on companies in India and China that facilitate Russia’s oil trade.
• Soybean futures reversed lower after a three-day rise as the US harvest began without fresh purchases from top buyer China, though optimism around US-China trade talks is offering some support.

Currencies

• The US dollar weakened sharply yesterday, especially versus a resurgent EUR, with EURUSD posting a new cycle and multi-year high above the former high of 1.1829 and all the way to 1.1878 before easing back ahead of tonight’s FOMC meeting.
• While USDJPY also dropped back on the broad USD weakness, the pair only managed to match the multi-week range low of 146.21 overnight before bouncing back toward 146.50. The relative JPY weakness had EURJPY testing close to the recent cycle highs just below 174.00, the last resistance ahead of the all-time high (since the introduction of the Euro) of 175.43 posted in 2024. This Japanese yen traders not only await the FOMC this evening, but a Friday Bank of Japan meeting.

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