USA

  During the last week, U.S. markets operated under a veil of uncertainty, as the federal government shutdown delayed many key economic releases (e.g. September nonfarm payrolls, CPI) and left investors parsing partial data and forward guidance. Instead of full prints, markets leaned heavily on initial jobless claims, which ticked up modestly (~235,000, per estimates) and raised questions about softening labor momentum. The FOMC minutes from the mid-September meeting (released Oct 8) underscored the Fed’s data-dependence stance: policymakers noted upside risks to inflation but also warned that growth and employment could soften further. In the business sector, PMI data showed manufacturing still expanding albeit at a slower clip (S&P Global US Manufacturing PMI dipped to ~52.0 from ~53.0) and services PMI cooled somewhat (from ~54.5 to ~54.2) amid soft order growth. Headwinds intensified late in the week: President Trump announced possible 100% tariffs on Chinese imports, triggering a sharp equity selloff on Friday. The S&P 500 plunged ~2.7% that day, the Nasdaq ~3.6%, and the Dow ~1.9%. Over the full week, the indexes ended lower: Institutional sources reported a ~2.4% weekly drop in the S&P, ~2.7% in the Dow, ~2.5% in the Nasdaq. The steep late-week reversal erased much of the mid-week gains fueled by AI-momentum and rate cut hopes.

Europe

In Europe, the last week began with moderate optimism, helped by dovish hopes for global central bank pivots and relatively resilient macro data (e.g. August retail sales in the euro area rose ~0.1 m/m, ~1.0 y/y per Fisher wrap). Business sentiment (PMIs) in the eurozone remained in modest expansion territory, with composite readings near ~51–52, though Germany’s August industrial production disappointed, falling ~4.3% month-on-month, signaling continued weakness in manufacturing. (This underscored the structural drag in Germany’s industrial base.) Meanwhile, the European Commission prepared trade-defense proposals (e.g. protecting steel industry) in response to dependency on imports and rising geopolitical frictions. But by week’s end, European equities were pulled lower by the global risk-off wave. The STOXX 600, FTSE 100, DAX, CAC and IBEX all gave back gains as U.S.–China tariff fears spread and investor sentiment soured. In the UK, HSBC’s move to acquire Hang Seng Bank added pressure to financial stocks. France’s political uncertainty also weighed on the CAC. Sectorally, cyclicals and banks underperformed, while defensives and staples held up better amid volatility. Overall, Europe followed the global risk tide downward, erasing earlier advances.

Japan



Japan’s markets entered the last week with some tailwinds: optimism was supported by positive tech sentiment and local political developments (e.g. the election of Sanae Takaichi as LDP leader, raising speculation about future policy direction) boosting chemical and industrial names. However, macro releases were limited in the holiday-shortened week; Japan’s industrial production and machinery orders for August were due but lacked a strong directional surprise. In financial commentary, analysts flagged that weak domestic demand and high debt burdens would limit room for policy easing. Equity markets initially held up, and by mid-week the Nikkei and tech names had shown relative strength, but Friday’s global downturn took its toll. The Nikkei 225 slipped into the weekly close, giving back earlier gains, and the TOPIX followed the same trend as risk sentiment soured. The lack of strong domestic data meant Japan’s equities were more exposed to external pressures than to local fundamentals.

China

China returned from Golden Week recess into a volatile environment. Although most key data (CPI, trade) fell just outside the Oct 6–10 window, markets were sharply reactive to trade rhetoric. Reports of fresh U.S. tariff threats (especially 100% rates) and China’s reciprocal export controls (in rare earths and semiconductors) rattled investor confidence.  On the data front, Fisher and other sources noted that September exports climbed ~8.3% year-on-year and imports ~7.4%, exceeding forecasts (though officially reported just after Oct 10). Equities responded sharply: Shanghai Composite declined modestly over the short trading stretch, and Hang Seng posted heavier losses (~2–3%) by Friday as tech names led the selloff. The sensitivity to external policy shifts rather than domestic economic momentum made Chinese and Hong Kong markets among the hardest hit in the region.