Market Quick Take – 16 September 2025

Market drivers and catalysts

• Equities: U.S. rose on tech and communication services strength ahead of the Fed; Europe firm as luxury and banks led; Asia mixed with Japan higher while China slipped
• Volatility: VIX mid-teens, skew higher, Fed event risk, SPX ±65pts
• Digital Assets: BTC $116k, ETH $4.5k, strong ETF inflows IBIT/ETHA, mixed alts
• Fixed Income: US treasuries firm, while Japan’s and Europe’s short yields near cycle highs
• Currencies: US dollar appears on verge of breaking down, CAD firms
• Commodities: Gold breaks to fresh record ahead of FOMC rate decision
• Macro events: Germany Sept ZEW Survey Expectations & US August Retail Sales

Macro headlines

• An appeals court blocked the White House from removing Federal Reserve Governor Lisa Cook from her post for now, while the Senate approved Trump's economic adviser Stephen Miran as a governor who will now join the Federal Reserve board amid Trump's pressure on the central bank to cut interest
• The New York Empire State Manufacturing Index dropped to -8.7 in September 2025, signaling a manufacturing decline. New orders and shipments fell sharply, while inventories and employment remained flat. Input prices stayed high, and selling prices were moderate. Optimism and employment are expected to remain flat.
• US President Trump reported positive US-China talks in Europe and plans to speak with China’s President Xi on Friday, hinting at a deal. Treasury Secretary Bessent confirmed a TikTok framework and upcoming talks. He differentiated anti-money laundering from the fentanyl issue, suggesting a potential 90-day tariff truce extension before November 10th.
• The SEC is "prioritizing" a proposal to reduce the frequency of corporate earnings reports after Donald Trump called for an end to quarterly reports. Trump said companies should report on a six-month instead of quarterly, which he claims will save money and allow managers to focus on running their companies.
• Canada's manufacturing sales rose 2.5% to CAD 70.3 billion, the largest increase since January 2023, exceeding the 1.8% forecast. Growth was driven by transportation equipment and aerospace products.

Macro calendar highlights (times in GMT)

0600 – UK Jul. Unemployment Rate, UK Aug. Jobless Claims Change/Payrolls Change
0900 – Germany Sept ZEW Survey Expectations
0900 – Eurozone Jul. Industrial Production
1230 – US August Retail Sales
1230 – Canada Aug. CPI
1315 – US August Industrial Production
1400 – US Sep. NAHB Housing Market Index
1700 – US Treasury to auction 20-year notes

Earnings this week

• Today: Ferguson
• Wednesday: Exor NV, General Mills
• Thursday: FedEx, Lennar, Darden Restaurants, Next PLC

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

Equities

• USA: S&P 500 +0.5% to a record above 6,600, Nasdaq 100 +0.8%, Dow +0.1% as progress in U.S.–China talks and a likely Fed cut supported risk. Alphabet jumped 4.5% to a $3T valuation after legal tailwinds, while Tesla rose 3.6% after Elon Musk bought about $1bn of stock. Nvidia finished flat as China flagged antitrust violations tied to the Mellanox acquisition. Texas Instruments fell 2.4% on China’s anti-dumping probe into U.S. analog chips.
• Europe: STOXX 50 +0.9% to 5,440 and STOXX 600 +0.4% as discretionary and banks outperformed despite France’s rating stress staying in view. Luxury led after upbeat broker calls and deal chatter, with LVMH up 2.8% and Kering up 5.8%. Banks advanced as rate-cut bets steadied curves into a heavy central-bank week. Broader breadth improved while defensives lagged. Attention now shifts to BoE and Swiss National Bank guidance and any color on growth risks into Q4.
• Asia: Tone mixed into the Fed. Nikkei 225 +0.5% as chip suppliers extended gains. Hang Seng +0.2% and Shanghai Comp −0.3% as weak August activity data and ongoing property drag capped sentiment, even as U.S.–China talks continued. Cambricon Technologies fell around 3%, while Contemporary Amperex (CATL) rose 9.1% and Sungrow Power gained 2.1%. Near term, China policy support and LPR signaling will set the regional tone alongside the Fed outcome.

Volatility

• Volatility is firming ahead of the Fed meeting. The VIX rose back into the mid-teens after drifting lower, suggesting traders are building in risk around Wednesday’s decision. SPX is near all-time highs, but option market data show increasing skew and hedging demand for downside protection. Tail risk metrics like SKEW are elevated, implying that a sharp drop remains a nontrivial possibility even if markets seem calm now. Retail sales and Fed forward guidance are likely triggers for intraday volatility. Expect volatility to spike around the Fed event, then retreat if the decision matches cautious expectations.

Digital Assets

• Bitcoin remains around $115-$116k; Ethereum near $4,500. Strong flows are supporting crypto: spot Bitcoin ETFs are receiving large inflows, led by IBIT, while ETHA is pulling in similarly large sums of capital. Altcoins are mixed: some underperformers, some resilience. Regulatory signals and policy (U.S. enforcement, licensing in Europe) continue to matter more than technicals in the short run. Investors are watching ETF flow data and Fed / macro signals closely—these still appear to dominate what drives crypto prices now.

Fixed Income

• US Treasuries traded sideways to slightly firmer, with the benchmark 2-year treasury yield dropping three basis points to 3.53% and the benchmark 10-year yield dipped a three basis points to mid-range at 4.03%.
• Japan’s and Europe’s front-end yields remain pinned near the cycle highs of recent months, with the benchmark 2-year German Schatz closing again above the ECB policy rate, at 2.02%, while the benchmark 2-year JGB nudged higher to within a basis point of the cycle highs this year – currently 0.88%

Commodities

• Gold extended its recent run of strong gains to a fresh record near USD 3,700, supported by a softer dollar and yields ahead of Wednesday’s US rate decision. Traders are so far relaxed about the risk of a short-term “sell the fact” reaction, with lower funding costs, strong ETF and Asian demand underpinning prices. Support at USD 3,545 and USD 3,500.
• Copper futures in London jumped to a 15-month high on Monday after a broad risk-on rally—briefly supported by US rate cut and China stimulus focus—saw prices break resistance at USD 10,170 before falling back. Rising inventories, especially in the US market, may limit further gains at this point.
• Brent crude remains range-bound between USD 65 and USD 70, caught between Russian disruption risks from Ukrainian attacks and renewed calls from Trump for tougher secondary sanctions on Russian crude buyers, and increased supply from OPEC+.

Currencies

• The US dollar weakened to start the week yesterday, with EURUSD buoyed up to the top of the recent range near just below 1.1800 (overnight high of 1.1787 before dipping back), while USDJPY has teased below 147.00 as it has been bottled up in a range between the low 146.00’s and the low 149.00’s for more than six weeks – possibly set to be shaken loose by the end of this week by the upcoming FOMC meeting tomorrow and BoJ meeting on Friday.
• The Canadian dollar firmed sharply yesterday, trading well below 1.3800 to a 1.3764 low overnight after starting the week near 1.3850. Canada reports August CPI today and the Bank of Canada is likely set to cut rates tomorrow as it is seen nearing the end of its easing cycle while the US Fed is seen just getting started on a new easing cycle this week.

For a global look at markets – go to Inspiration.