Market Commentary: Wednesday 1st October

US Government shutdown began at midnight after Democrats blocked the Republicans’ stopgap funding package, with both parties deadlocked over health care subsidies. Around 750,000 federal workers will be temporarily furloughed, and the Trump administration has suggested mass layoffs of government workers may follow. The shutdown will also delay the release of key economic data, including Friday’s jobs report. US equity futures fell, with S&P 500 futures down 0.43%, trading at 6,709.8. Spot gold continues to climb, trading at $3,860/oz.

EU leaders are meeting in Copenhagen today to discuss drone defense plans. However, the complexity and required funding are likely to cause delays, making the plan unlikely to be realized in the next few years.

On the economic calendar, China and Hong Kong markets are closed for Golden Week. A series of Manufacturing PMI releases are scheduled: France (8:30 am), Germany (8:55 am), Eurozone (9:00 am), and the UK (9:30 am).

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