Closing Recap

U.S. stocks finished broadly higher, with the S&P 500 and Nasdaq grinding to new records in another quiet “melt-up” session, as investors shrugged off a government shutdown and focused on strong momentum in the AI space; gold pulled back from all-time highs, oil prices plunged, and the dollar was on the defensive. In the currency markets, the U.S. dollar remained weak, pressured by the government shutdown and dovish Fed expectations, with the EUR/USD holding above 1.17 and the Japanese Yen seeing a volatile but ultimately range-bound session.

Key Takeaways 

• Stocks “Melt Up” to New Highs: Major indices continued their relentless climb, with the S&P 500 and Nasdaq hitting new records, driven by powerful momentum in the technology sector. 
• Government Shutdown Ignored: The market showed no concern on day two of a partial U.S. government shutdown, which has delayed the release of today’s key Nonfarm Payrolls report. 
• Shutdown Ignored, Focus on Private Data: Now on Day 3, the U.S. government shutdown is having zero negative impact on equity sentiment. With Friday’s jobs report cancelled, all market focus shifts to today’s ISM Services PMI report.
• AI & Momentum Names Lead Charge: The rally was again led by the AI ecosystem, with semiconductor stocks (SOX) hitting another record, and other momentum plays in power, data centers, and crypto also gaining. Nvidia became the world’s first $4.6 trillion company. 
• Oil Plunges to 4-Month Lows: WTI crude fell over 2% to its lowest level in four months, weighed down by demand concerns and expectations of increased OPEC+ supply. 
• Dollar Weakness: The U.S. dollar remained weak and near multi-week lows, with the DXY index below 98.00, as investors favored other currencies amid the U.S. government shutdown. The Japanese Yen is drifting lower today but remains a top performer this week, while EUR/USD and AUD/USD are pinned by large options expiries.
• Bitcoin Surges to $120,000 on “Uptober” Cheer: The cryptocurrency is a standout performer, rallying sharply to a seven-week high near $120,000 as “Uptober” seasonal optimism and expectations of a Fed liquidity boost ignite the market.
• Gold Eases, Yields Steady: Gold prices pulled back from recent record highs on profit-taking, while Treasury yields were little changed. 

Market Overview

U.S. equity markets continued their impressive upward march today, with major indices grinding higher to new all-time highs in another session characterized by low volume and a clear “buy the dip” mentality. The ongoing partial U.S. government shutdown, now in its third day, had virtually no negative impact on market sentiment. In fact, the delay of today’s highly anticipated Nonfarm Payrolls report seemed to remove a potential source of volatility, allowing investors to focus on the market’s powerful underlying momentum. The leadership of the rally remains firmly entrenched in the technology sector and the broader AI theme. 

Index	Last	Change	% Change
S&P 500	6715	4.21	0.0006
Nasdaq	22844	88.89	0.0039
Dow Jones	46520	79.05	0.0017
Russell 2000	2458	16.14	0.0066

The bullish conviction is unshakable. There is zero market concern about the shutdown, with historical data showing stocks tend to perform well in the year following such events. The primary driver remains the expectation of aggressive Federal Reserve easing, with a near-100% chance of an October rate cut now priced in.

The Philadelphia Semiconductor Index (SOX) rallied for a fifth straight day to another record high, with Nvidia (NVDA) notably crossing the $4.6 trillion market capitalization threshold. European and Asian markets also saw gains overnight. With official economic data on hold due to the shutdown, investors will place even more emphasis on private-sector reports, like today’s ISM Services PMI, and commentary from the numerous Fed officials scheduled to speak. The narrative of an impending Fed rate cut remains a key supportive factor for the market, though some Fed speakers, like Dallas Fed President Lorie Logan yesterday, have struck a more cautious tone.

Economic Calendar

With the U.S. government shut down, there were no official U.S. economic data releases yesterday. The market continues to operate in an information vacuum, relying on private surveys and commentary.

With the NFP report cancelled, today’s U.S. ISM Services PMI is the undisputed main event of the week. 

• CANCELLED – US Non-Farm Payrolls Report. 
• 14:00 GMT – US ISM Services PMI (Sep) (Exp: 51.7). 
• Fed Speakers: Williams (10:05 GMT), Jefferson (17:40 GMT). 
• ECB/BoE Speakers: Lagarde (09:40 GMT), Bailey (13:20 GMT).

Commodities, Treasuries and Currencies 

In other markets, Gold pulled back from its all-time high of $3,923, with futures settling down 0.75% at $3,868.10 as profit-takers emerged. However, the metal is still on track for a seventh straight weekly gain. The rally was fueled by strong safe-haven demand ahead of the U.S. government shutdown and a weaker U.S. dollar. Crude oil prices slumped on Monday, with WTI falling $1.30 (-2.1%) to settle at $60.48/bbl. The drop was attributed to plans for another OPEC+ output increase and the resumption of Iraqi Kurdish oil exports, which raised global supply outlook concerns. 

Asset	Change	Unit	Last
WTI Crude	-1.3	USD/bbl	60.48
Gold	-29.4	USD/oz	3868.1
EUR/USD	-0.0012	USD	1.1716
USD/JPY	0.13	JPY	147.18
US 10-Yr Yield	-0.0 bps	%	0.04105

In the currency markets, the U.S. Dollar Index (DXY) remained subdued, trading around 97.85, as traders stayed cautious due to the looming government shutdown:

• USD/JPY: The pair is seeing a modest bounce towards 147.70 today, but the Japanese Yen remains one of the week’s strongest performers. The pair is caught in a technical battle between its 100-day SMA support (~146.50) and its 200-day SMA resistance (~148.21). A notable $1.4B options expiry at the 148.00 level could help cap any further upside during today’s session. 
• EUR/USD: The pair is trading quietly around 1.1720, having lost momentum yesterday. The broader dollar weakness is providing a floor, but dovish ECB commentary is limiting the upside. A $2.3B options expiry at the 1.1700 strike provides a significant support level for traders to watch today. 
• GBP/USD: Sterling is trading with a mild positive bias near 1.3435. The pair is being supported by the weak U.S. job market narrative, which is fueling bets on Fed rate cuts.

U.S. Treasury yields declined, with the 10-year yield falling over 4 basis points to 4.107%, as investors sought safety ahead of the shutdown deadline and priced in dovish Fed expectations. Bitcoin rebounded, rising above $114,000, driven by seasonal “Uptober” optimism and signs of renewed buying by large holders.

Looking Ahead 

The market will be navigating an information vacuum in the coming days due to the government shutdown, which will delay key data releases like jobless claims and the Nonfarm Payrolls report. This will place even greater emphasis on private-sector data, like Friday’s ISM Services PMI, and commentary from the many scheduled Fed speakers. The duration of the shutdown will be a key focus, as a prolonged impasse could begin to have a more tangible economic impact. Earnings season will also start to ramp up, providing company-level insights. WTI crude is now down nearly 14% year-to-date and sitting at 4-month lows ahead of this weekend’s OPEC+ meeting.

Traders will be watching for any headlines or official statements regarding the size of the expected supply increase, which could trigger the next major move. While gold has pulled back, the underlying conditions (shutdown uncertainty, dovish Fed) remain highly supportive. The reaction to the ISM data will be crucial. A weak report could easily send gold back towards its record highs. Be aware of the large options expiries that could influence price action into the New York cut: EUR/USD at 1.1700, USD/JPY at 1.4800, and AUD/USD at 0.6600. These levels can act as anchors or turning points, especially in a data-light environment.