US Federal Reserve Vice Chair Philip Jefferson has already warned of weakening employment conditions, raising concerns about the economy’s resilience. Technology and growth stocks may continue to see selective interest, but defensive and rate-sensitive sectors are likely to remain volatile in the current environment.
In Europe, markets opened slightly lower, with the STOXX 600 easing as energy shares dragged on sentiment following a dip in oil prices. The looming US shutdown has also dampened risk appetite across the region.
Economic data has added to the cautious mood: German unemployment rose more than expected in September, while Italian inflation came in at 1.8 percent year-on-year, a touch above forecasts. These readings could complicate the European Central Bank’s policy stance. Meanwhile, ECB officials have called for reinforcing the euro’s role as a global anchor of stability, hinting at a longer-term policy ambition.
Overall, US markets are bracing for a volatile session dominated by fiscal uncertainty and labor data, while European equities are trading with a softer tone, pressured by sectoral weakness and global risks.