Market Quick Take – 5 September 2025

Market drivers and catalysts

• Equities: U.S. hit records on softer labor and firm services; Europe edged higher as yields eased and travel slumped; Asia mixed with Japan up and China/HK softer on cooling-measures chatter
• Volatility: VIX mid-teens • jobs report risk • SPX move ±37 pts
• Digital Assets: BTC steady • ETH flat • IBIT inflows • ETHA outflows • SEC reform talk
• Fixed Income: US and Japanese treasury yields lower ahead of key US employment report today
• Currencies: USD edges lower after soft payrolls data
• Commodities: Third weekly gain led by gold, silver, zinc, natural gas and diesel
• Macro events: UK Jul Retail Sales & US Aug Nonfarm Payrolls

Macro headlines

• US private businesses added 54K jobs in August 2025, below the 65K forecast, following +106K in July. Leisure and hospitality led gains, amid a general hiring slowdown. The service sector gained 42K jobs; goods-producing added 13K, while manufacturing lost 7K jobs. Early strong job growth has been disrupted by uncertainty.
• US will lower tariffs on Japanese auto imports to 15% by month's end, per an executive order by President Trump, Reuters reported. This formalizes a July trade agreement with Tokyo, easing negotiations and reducing uncertainty for Japan's auto industry.
• Japan's nominal wages rose 4.1% in July 2025, exceeding the 3% forecast. Real wages increased 0.5% for the first time since December, aided by steady pay and bonuses, but high prices persisted. Consumer inflation hit 3.6%, above the 2% target. Major firms agreed to pay hikes over 5% in spring talks.
• The ISM Services PMI increased to 52 in August 2025, surpassing the forecast of 51 and marking the highest growth in six months. Business activity, new orders, and inventories saw faster growth. However, employment contracted (46.5), backlog of orders hit a 16-year low (40.4), and prices remained elevated (69.2).
• The US trade gap widened to $78.3 billion in July 2025, exceeding forecasts of $75.7 billion. Exports grew 0.3% to $280.5 billion, while imports rose 5.9% to $358.8 billion. Gains in nonmonetary gold and civilian aircraft contrasted with declines in finished metal shapes and pharmaceutical preparations.
• US initial jobless claims rose by 8,000 to 237,000 in late August, exceeding expectations of 230,000. Continuing claims fell to 1,940,000, the lowest in five months, below forecasts of 1,960,000. The report indicates a softening labor market, supporting the Fed's view on potential rate cuts.

Macro calendar highlights (times in GMT)

0600 – Germany Jul. Factory Orders
0600 – UK Jul. Retail Sales
1230 – US Aug. Nonfarm Payrolls Change
1230 – US Aug. Unemployment Rate
1230 – US Aug. Average Hourly Earnings
1230 – Canada Aug. Unemployment Rate, Employment Change

Earnings events

Note: earnings announcement dates can change with little notice. Consult other sources to confirm earnings releases as they approach.

Earnings next week

• Tue: Synopsys, Rubrik, Aerovironment
• Wed: Inditex
• Thu: Adobe, Kroger

For all macro, earnings, and dividend events check Saxo’s calendar.

Equities

• USA: S&P 500 +0.8% to a record, Nasdaq Composite +1.0%, and Dow +0.8% as weak ADP hiring (54k) and higher jobless claims (237k) firmed September cut odds while ISM services rose to 52.0. Amazon +4.3% on AI optimism and retail strength; Meta +1.6%. Broadcom +1.2% ahead of results, while Salesforce −4.9% on guidance reset. After the close, Broadcom +4.5% on a beat and raise; DocuSign lifted its outlook sending the shares up 8.2%; Lululemon −16% after cutting guidance, setting today’s tape.
• Europe: STOXX 50 +0.4%, STOXX 600 +0.7%, FTSE 100 +0.4% as lower long yields and U.S. data supported risk. Tech led with ASML +3.6% and SAP +0.8%. Travel lagged after Jet2 cut winter capacity and steered to the low end of guidance: Jet2 −12.5%, easyJet −4.2%, Ryanair −2.9%. Broader cyclicals were mixed as investors weighed U.S. labor softness against resilient services.
• Asia: Tone mixed on Thursday’s closes. Nikkei 225 +1.5% as local tech tracked Wall Street’s bounce, while Hang Seng −1.1% to 25,058 and CSI 300 −2.1% after reports China may ease short-selling curbs to cool an overheated market. Tech and property weakened in Hong Kong as profit-taking met policy chatter, while Japan’s chip complex and exporters firmed on improved risk appetite and stable rates.

Volatility

• Volatility stayed contained on Thursday. The VIX slipped to 15.3 (−6.4%), while September VIX futures traded near 16.5, signaling calm conditions ahead of today’s U.S. jobs report. Investors have shifted into a wait-and-see mode as payroll and unemployment figures will likely set the tone for rate expectations. Short-dated volatility gauges (VIX1D +36%) briefly spiked but reflect hedging demand around the data rather than broad stress.
  Expected SPX move from options pricing: about ±37 points (0.6%) for today.

Digital Assets

• Crypto markets held steady. Bitcoin trades near $111.6k (+0.7%) and ether around $4.34k (+0.9%). ETF flows show divergence: on Sep 4, IBIT added $135m while peers saw outflows, leaving the group at −$223m. Ethereum ETFs weakened, with ETHA losing $217m that day. Altcoins were mixed, with solana +1% and xrp flat. Regulatory news added intrigue: the SEC admitted to losing former chair Gensler’s texts during peak enforcement years, while Chair Paul Atkins unveiled proposals for crypto safe harbors and lighter broker-dealer rules. Market maker Wintermute urged clarity that network tokens like BTC and ETH are not securities.

Fixed Income

• US yields retreated further yesterday in the wake of a soft ADP payrolls change report, with the benchmark 10-year treasury yield falling seven basis points to a new low since early May at 4.15%, while short yield also nudged slightly lower as the 2-year benchmark yield posted its second-lowest daily close this year at 3.59% as a September Fed rate cut is now 100% priced into the forward curve and more than two cuts (about 60 basis points total) are price through the December FOMC meeting.
• Japanese Government Bonds rallied again overnight despite news of strong growth in wages released overnight, with the benchmark 10-year JGB yield tumbling another three basis points to 1.57%, near a three-week low, while the 2-year JGB yield likewise traded to its lowest level in three weeks at 0.84%

Commodities

• Ahead of today’s US jobs report, the Bloomberg Commodity Index is on track for a third straight weekly gain, driven by strength in industrial and especially precious metals. Gold and silver have both risen more than 4% after breaking higher on technical momentum, supported by rate-cut expectations and concerns over Fed independence. The energy sector is mixed but overall firmer, with gains in natural gas and diesel offsetting a weekly decline in crude ahead of this weekend’s OPEC+ meeting. Agriculture trades lower, weighed down by broad losses across grains and softs, notably soybeans, wheat, sugar, and cotton.
• Crude prices steadied following a two-day slump driven by speculation this weekend’s OPEC+ meeting, contrary to expectations, may yield another production increase.
• Gold trades near the record set earlier in the week having recovered from Thursday’s round of profit taking with the short-term direction now depending on today’s US jobs report, and its impact on rate cut expectations, bond yields and the dollar.

Currencies

• The US dollar edged lower within recent trading ranges as US yields fell on the latest private payrolls data, although the big test for the greenback will be over today’s August jobs report, perhaps especially the size of any revisions to the Nonfarm Payrolls Change data of the last two months after the large revision of the prior two months’ data in the July report.
• Sterling firmed further as long interest rates dropped aggressively yesterday after a recent spike. The long 30-year Gilt benchmark closed yesterday at 5.57%, down from an intraday spike the prior day to as high as 5.75%.

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