European Markets Steady Amid Shutdown Concerns and AI Valuation Warnings

# European Markets Steady Amid Shutdown Concerns and AI Valuation Warnings

**Note**: This analysis is generated during European session, markets open. Event times in US Eastern Time.

## Major News

Global market sentiment remains cautious amid various developments today. In the U.S., futures indicate a slight uptick, with S&P 500 futures up 0.04%, Dow futures rising by 0.07%, and Nasdaq futures gaining 0.02%. These modest increases come as the government shutdown continues, now entering its third day, leading to concerns about economic impacts.

In Europe, indices showed mixed performance; the FTSE 100 rose 0.40%, while the Euro Stoxx 50, DAX, and CAC 40 experienced slight declines of 0.002%, 0.17%, and 0.11%, respectively. The Nikkei in Japan performed notably well, increasing by 1.54%.

Market analysts are expressing concerns over “frothy” valuations in private equity, particularly in the AI sector, with some companies reportedly valued at up to 100 times their revenue. This has raised alarms about a potential bubble, echoing sentiments from GIC Pte’s CIO regarding the risks of bond sell-offs.

Additionally, the Energy Department’s cancellation of green projects in blue states could have implications for energy markets. Meanwhile, the European airspace faced disruptions due to drone sightings, briefly halting flights at Munich Airport

## Performances

### US Futures

US futures indicate opening sign for cash market.

### Major US Indices (Previous Close)

Previous close performance for US indices.

### European Indices Performance

### Nikkei Performance

### FX Performance

### Commodities Performance

### BTC and ETH Performance

## Economic Calendar of Today (Most Important Events)

The following table lists high-importance economic events for today, 2025-10-03, with times in US Eastern Time.

**Notes**:
– **Cur**: Currency associated with the event (with flag emoji).
– **Imp**: Importance (High, Medium, Low, None).
– **Actual**: Reported value (if available).
– **Forecast**: Expected value (if available).

On October 3, 2025, several key economic events are expected to influence global markets. Notably, the S&P Global Services PMI for Russia reported a contraction at 47.0, indicating weaker service sector activity, which may pressure the Russian Ruble (RUB).

In the Eurozone, the HCOB Spain Services PMI exceeded expectations at 54.3 (forecast: 53.3), while Italy also showed strength with a reading of 52.5 (forecast: 51.5). However, France’s PMI fell short at 48.5 (forecast: 48.9), and Germany’s PMI also disappointed at 51.5 (forecast: 52.5). The HCOB Eurozone Composite PMI matched expectations at 51.2, with the Services PMI slightly below forecast at 51.3 (forecast: 51.4). These mixed results may create volatility in the Euro (EUR), with potential downward pressure stemming from the underperformance of key economies.

In the U.S., the S&P Global Services PMI is expected at 53.9, with the ISM Non-Manufacturing PMI anticipated at 51.8. Stronger-than-expected figures could bolster the U.S. Dollar (USD). Additionally, factory orders are forecasted to rise by 1.4%, further supporting the USD. Market participants will closely monitor comments from ECB President Lagarde and FOMC Member Williams for additional insights into monetary policy direction

## Remaining Economic Calendar Comment for the Week (Important Events Only)

On September 29, 2025, several key economic events impacted global markets, particularly currencies. Notably, the Spanish CPI reported a lower-than-expected YoY inflation rate of 2.9%, against a forecast of 3.1%, which may influence the EUR’s strength as it reflects easing inflation pressures. Conversely, the German CPI aligned with expectations at 2.4%, potentially stabilizing the euro.

The U.S. saw a significant surprise with pending home sales rising 4.0% MoM in August, far exceeding the forecast of 0.2%. This positive data may bolster the USD as it suggests resilience in the housing market amid economic uncertainties. However, the Chicago PMI fell to 40.6, below the expected 43.4, indicating potential contraction in manufacturing, which could weigh on USD sentiment.

In Japan, the Tankan survey revealed a lower manufacturing outlook index at 12, compared to the anticipated 13, suggesting concerns about future business conditions. This disappointment may exert downward pressure on the JPY. Additionally, the industrial production data showed a sharper decline of -1.2%, against a forecast of -0.7%, further supporting a bearish outlook for the yen.

Overall, these mixed signals across key economies are likely to lead to volatility in currency markets as investors reassess growth prospects.