Concerns about the effects of the government shutdown, weak data readings from the University of Michigan, and a retreat from risk are leading to an extension of the correction on Wall Street.
- US100 contracts are losing about 1.9%, while Russell and S&P 500 contracts are down over 1.3%.
Since the beginning of the week, we have observed a noticeable decrease in investors' risk appetite and a general deterioration in sentiment. The market now expects not only Capex and promises from technology and AI giants but also monetization strategies and returns on investment in the perspective of quarters, not years.
The situation is worsened by the US government shutdown, which has already become the longest in history. Previous episodes of this type ended with limited impact on the economy, but the situation is becoming increasingly serious, as confirmed by comments from Kevin Hassett, one of the main economic advisors to the White House. Hassett states that the effects of the shutdown are "much worse than expected." A similar view is held by Scott Bessent, who claims that a large part of the US economy is already realistically in recession. These concerns are also shared by the Speaker of the House of Representatives, Johnson. The lack of a quick address to the American budget problem could push indices significantly lower if further risks materialize.
Additionally, the market has learned the results of the University of Michigan report on consumer sentiment and inflation expectations, which also does not allow for an improvement in market mood. The University pointed to a deterioration in sentiment among consumers in all segments. A particularly large decline was noted in "current conditions." These readings are particularly important in conditions of limited access to macroeconomic data due to the government shutdown.
The accumulation of these factors is bringing American indices to their lowest levels in over a month.
US100 (D1)
Source: xStation5
Daily summary - Government stays shut, Market declines, crypto recovers
US OPEN: Market extends decline at the end of the week
CAD Gains on Strong Canadian Labor Market Data 💡
Constellation Energy: Mixed Results for Q3 2025
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
