U.S. markets focus on delayed data as government reopens
With the U.S. government reopening after six weeks, markets now shift to a backlog of delayed economic releases that will test the Federal Reserve’s next moves. This matters now because fresh payrolls, inflation and other datapoints will clarify whether the Fed can cut rates this year. In the short term traders will parse immediate volatility in yields, currencies and equities. In the longer term the data will influence global risk appetite across the United States, Europe, Asia and emerging markets. Markets are calmer than expected given 2025 political shocks, but the incoming reports will show whether that calm can last.
Data returns to the calendar
Delayed economic prints regain market attention and raise the bar for Fed easing
The government reopening puts previously frozen statistics back on the agenda. September national payrolls could appear as soon as next week. There are still doubts about whether October jobs and inflation figures will be published because of data collection gaps. That means the immediate economic picture will be noisy and incomplete.
Market pricing for a December Fed rate cut has pulled back to roughly even odds. Regional Fed officials have signaled caution while they wait for clearer information. Boston Fed chief Susan Collins recently said she would be reluctant to ease policy without stronger evidence of labor market deterioration. That comment matters now because it underscores how sensitive policy expectations are to the incoming data.
Short-term, traders will watch revisions and the sequencing of releases. Over the medium term, consistent data that points to cooling wage growth and easing inflation could tilt the debate back toward easier policy. For global investors, U.S. data will remain the single largest driver of cross-asset flows for the rest of the year.
Policy, supply and borrowing costs
Treasury auctions, Fed commentary and oil inventories influence yield dynamics
Treasury yields have stayed contained even after a lukewarm 10-year note auction. Treasury Secretary Scott Bessent said auction sizes for longer-dated debt will not increase in the quarters ahead and pushed for changes to supplementary leverage ratios that discourage banks from holding Treasuries. That combination has helped cap a rise in long-term yields.
Energy markets contributed to calmer bond markets this week. U.S. crude prices fell to a three week low after OPEC and the International Energy Agency flagged a likely surplus through next year. That pullback in oil eased inflation pressures and gave bonds some relief.
In the coming sessions the U.S. sale of $25 billion of 30-year bonds will be a focal point. Lower auction demand could push yields higher and complicate the Fed’s communication. Meanwhile central bank commentary from the St. Louis Fed, Cleveland Fed and San Francisco Fed will be watched for nuance. European and Asian policy signals will also matter for global funding costs.
Currencies and global flows
Dollar softens while yen volatility triggers official warnings
The dollar weakened against the euro and the Chinese yuan after the government reopening and the oil price retreat. The euro strengthened to its best level of the month while the yuan hit its strongest levels since October. Japan’s yen has been under pressure and then briefly recovered after comments from Tokyo cautioning against a rapid rise in rates by the Bank of Japan.
Intervention concerns and large speculative bets on the yen have made currency markets more reactive. Investors who positioned for a yen recovery learned a costly lesson earlier this year when expectations for a U.S. slowdown did not play out as planned. For emerging markets, a softer dollar can ease balance of payments strain and support equity flows. However, sudden moves in any major currency can create cross-asset spillovers into bond and equity markets.
Equities and earnings ahead of the bell
Sector rotation persists as tech shows mixed signals and China offers a lift
U.S. stocks traded with modest dispersion on Wednesday. The Dow Jones Industrials reached a fresh record while the Nasdaq ended lower on renewed valuation concerns. Investors rotated into cyclical and financial names even as technology continued to attract headlines.
Advanced Micro Devices (NASDAQ:AMD) jumped after outlining an ambitious data center revenue goal. International Business Machines (NYSE:IBM) also touched a new high on progress in quantum computing. At the same time Amazon (NASDAQ:AMZN), Tesla (NASDAQ:TSLA), Palantir (NYSE:PLTR) and Oracle (NYSE:ORCL) retreated on mixed sentiment in the sector.
Chinese markets outperformed in part because of stronger corporate results. Tencent (HKEX:0700) posted a better than expected earnings print that helped sentiment. Global indices remain near record territory with MSCI’s all-country index setting a new high. That is notable given the political and trade shocks experienced earlier this year.
Corporate earnings due this session include Walt Disney (NYSE:DIS) and Applied Materials (NASDAQ:AMAT). Investors will use those reports to assess consumer demand, capex trends and tech hardware cycles. The way these earnings are read could influence sector positioning into year-end.
What to watch and the implications for the session
Speeches, auctions and economic prints will set near term market tone
Market participants should listen for nuance from several Fed speakers, and follow the outcome of the 30-year Treasury auction. Incoming payrolls and inflation data that are released this week will give market participants fresh inputs for pricing interest rate expectations. The interplay between data, fiscal moves and central bank commentary will determine the path of yields and the behavior of risk assets.
In the short run markets will remain sensitive to any surprising datapoint or auction weakness. Over a longer window the key question is whether the steady performance of stocks and the stabilization of borrowing rates can hold after a year of political and policy turbulence. Investors will compare the new information against a backdrop of higher tariffs and trade policy adjustments that shook markets earlier in 2025.
For traders and portfolio managers, the reopening of the data flow means more pieces to the macro puzzle. The immediate session will be about parsing noise from signal and positioning for potential volatility around scheduled releases. The next set of official numbers will define how quickly market pricing for policy adjusts and how global asset allocation responds.
