Market drivers and catalysts
Equities: Weak US finish on soft jobs while semis diverged; Europe slipped as exporters and banks lagged; Asia firm Friday with Hong Kong and China higher on PBoC liquidity
Volatility: VIX mid-teens, ETF hedging inflows, SPX move ±25 pts
Digital Assets: BTC ~$111k, ETH ~$4.3k, stablecoins on ETH record
Fixed Income: US yields hit new local lows Friday on weak jobs report
Currencies: USD weakness Friday partially eases as JPY weakness dominates to start the week on political turmoil in Japan
Commodities: Crude up on modest production increase. Gold holds near record
Macro events: French confidence vote
Macro headlines
France’s Prime Minister Bayrou will face a confidence motion in the lower house today, one that he is widely expected to lose, throwing French politics into uncertainty again. President Macron says that he would rather appoint a new Prime Minister rather than hold new elections.
US non-farm payrolls showed the economy added just 22k jobs vs 75k expected in August and the unemployment rate rose to 4.3%. June's 14K previously revised print was again revised lower to –13K while July’s 73k figure was revised higher to 79k.
The Japanese yen fell, and stocks rose after PM Shigeru Ishiba resigned as LDP President following election losses that cost the coalition its majority. He has called for an emergency leadership vote and will stay on until a successor is chosen.
Japan annualized QoQ GDP for Q2 rose 2.2%, way above expectations of a 1% gain.
Macro calendar highlights (times in GMT)
0600 – Germany July Industrial Production
1700 – France's National Assembly confidence motion vote
Norway’s Parliamentary Election
Earnings events
Note: earnings announcement dates can change with little notice. Consult other sources to confirm earnings releases as they approach.
Earnings this week
Tue: Oracle, Synopsys, Rubrik, Aerovironment
Wed: Inditex
Thu: Adobe, Kroger
For all macro, earnings, and dividend events check Saxo’s calendar.
Equities
USA: S&P 500 −0.3%, Nasdaq 100 +0.1%, Dow −0.5% on Friday as a soft August jobs print reinforced cut bets while tariff headlines kept chip volatility high. Broadcom jumped 9.4% on a stronger AI revenue outlook and a reported USD 10bn custom-chip deal with OpenAI. Nvidia fell 2.7% and AMD slid 6.6% on rotation and downgrade pressure, while Lululemon plunged 18.6% after a second profit warning. Focus turns to CPI and the September FOMC for confirmation of a larger policy move.
Europe: Euro Stoxx 50 −0.5% and Stoxx 600 −0.2% as euro strength and US slowdown worries weighed on exporters and financials; FTSE 100 −0.1%. Airbus dropped 1.7% after delivery headlines tempered sentiment, BNP Paribas fell 1.5% with yields softer, and Munich Re lost 1.6% alongside wider insurance weakness. Discretionary underperformed while defensives steadied the tape. Attention is on US CPI and ECB commentary to gauge the growth-vs-currency trade-off.
Asia: Friday closes were firmer: Nikkei 225 +1.0%, Hang Seng +1.4% to 25,418, and CSI 300 +2.2% as China’s 1-trillion-yuan liquidity boost form central bank (PBoC) added support. Tech and property led in Hong Kong; SMIC rose 6% and Tencent gained 2.2% as liquidity and AI demand narratives offset global chip jitters. Japanese cyclicals participated as yen steadied. Next up: China credit data and any follow-through on liquidity signals.
Volatility
Volatility remains calm. The VIX closed at 15.18, near the mid-teens, while short-dated measures like the VIX9D sit even lower, showing investors are not pricing in much near-term stress. That said, inflows into VIX-linked ETFs last week (+$81m) suggest some are still hedging against surprises. With U.S. inflation data due later this week, volatility could pick up again, but for now the backdrop is steady.
SPX options imply today’s move at ±25 points (~0.38%).
Digital Assets
Crypto prices are stable with bitcoin at ~$111k and ether around $4.3k. ETF flows turned negative on Friday: IBIT −$63m, while ETH funds saw heavier pressure, led by ETHA −$310m. Despite these outflows, prices have held firm, suggesting dip-buying support. Altcoins are mixed with SOL at $207 and XRP at $2.88. On-chain, Ethereum hit a record $165bn in stablecoins, reinforcing its role as the dominant settlement network. Meanwhile, El Salvador marked four years since adopting bitcoin, though the government has since scaled back its legal tender push. Miners remain under pressure as bitcoin network difficulty reached a new record.
Fixed Income
US treasuries rallied again on the weak US August jobs report, with the benchmark 10-year treasury yield falling nine basis points on Friday to close at a new low since early April at 4.07% before rebounding slightly in early trading. At the front end of the curve, the benchmark US 2-year treasury yield was more volatile, falling 12 basis points at the lows before rebounding as some market participants price the Fed to cut more than 25 basis points at the FOMC meeting new week. The market is now pricing a total of 69 basis points of further Fed easing through the December FOMC meeting versus 61 basis points on the day prior to the jobs data release.
Japanese Government Bonds rallied on the strength in US treasury markets and on the news that Prime Minister Ishiba will step down.
Currencies
The US dollar sold off Friday on the weak August jobs report, as EURUSD rallied well clear of 1.1700 and above the range since late July of 1.1743, while USDJPY tested below 147.00 late Friday. But the news of Japan’s PM Ishiba stepping down brought a sharp sell-off in the JPY overnight, sending USDJPY back above 148.50 at one point overnight before the price action settled back toward 148.00.
USDCAD ended Friday higher despite notable USD weakness elsewhere on a very weak Canadian jobs report for August that was released at the same time as the US report. The Net Change in Employment number for the month came in at -65.5k versus +5k expected and the Unemployment Rate shot up to 7.1% vs. 7.0% expected, a new post-pandemic high or the rate.
Commodities
Brent bounced from support at USD 65 after OPEC+ agreed to revive another layer of halted production at a measured pace of just 137,000 barrels per day in October. The move underscores the group’s caution as the market heads into an expected surplus. Prices had already sold off last week in anticipation, paving the way for Monday’s rebound, further aided by comments that the remaining 1.66 million barrels hinge on “evolving market conditions.”
Gold came within a whisker of USD 3600 overnight, buoyed by Friday’s weak US jobs report, which all but cemented expectations for a succession of rate cuts starting this month. Adding further support, the People’s Bank of China reported a 10th consecutive monthly increase in its gold holdings in August, continuing its effort to diversify reserves away from the USD.
According to the latest COT report, managed money accounts held the bulk of their USD 129 billion exposure across 27 major commodity futures in just one contract—gold at USD 61 billion—followed by Brent crude at USD 17.4 billion, live cattle at USD 12.5 billion, and silver at USD 8.5 billion. These figures highlight gold’s phenomenal strength this year, with shallow corrections failing to challenge long-held positions, thereby limiting forced adjustments.
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