- Equity Markets: Global equity markets closed higher yesterday as investors brushed off concerns about a potential U.S. government shutdown. The S&P500 finished up +0.41% and the Nasdaq rose +0.30%, Europe was up +0.48%. In the US, seven of the eleven sectors were in positive territory and 60% of stocks ended higher. Health Care (+2.45%) and IT (+0.86%) were the best performers. Energy (-1.07%) and Consumer Discretionary (-0.55%) were weakest. Nvidia (+2.60%) hit a new intraday high after an analyst forecasted that AI capex from 2025 to 2029 will hit $2.8trillion. Pfizer jumped (+6.81%) after it agreed to cut certain drug prices by as much as 85% and sell directly to U.S. consumers in return for a three-year exemption from pharmaceutical tariffs. In Europe, nine of the eleven sectors were positive, with 67% of stocks ending higher. Health Care (+0.81%) and Communication Services (+0.81%) were strongest, while Energy (-1.98%) and Consumer Discretionary (-0.14%) were weakest.
- Macro: In macro news yesterday in the US, MNI Chicago PMI for September fell to 40.6 (43.3 est.) after 41.5 the prior month. JOLTS Job openings in the U.S. remained largely unchanged at 7.227m in August, while hiring slowed, indicating a gradual decline in labour demand. U.S. consumer confidence declined by 3.6 points in September to 94.2 (96.0 est.), reaching its lowest level in five months. In economic news out of Europe yesterday, Germany’s seasonally adjusted unemployment rate remained steady at 6.3% in September, in line with economists’ expectations. German inflation rose faster than expected in September to 2.4% (2.2% est.), contributing to a broader uptick across the region, that should strengthen the European Central Banks determination to maintain interest rates on hold.In macro news today, over-night the U.S. government entered a shutdown after the Senate voted down a stop-gap funding bill on Tuesday, leaving little indication of a resolution. Concerns have emerged over potential delays to important economic reports, including the non-farm payrolls. President Trump also suggested he might use the shutdown as justification to carry out large-scale layoffs of federal employees and cut funding for programs he opposes.
- Stocks: Glanbia: (Overweight. €16.50: 18% upside): Yesterday Tirlán announced it would sell 17m shares of Glanbia. Further details in note.CRH: (Overweight. £102.80: 15.8% upside): Review of yesterday’s Investor Day in New York and price target increase.Flutter Entertainment: (Overweight. $293: 15% upside). Commentary on UK Chancellor Reeves indication on increased taxes on gambling companies, and price target decrease.
- Debt: Volatility in European bond markets remains very low with the front-end anchored by an on-hold ECB and 10-year Bunds trading around 2.75%.
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