Global Markets Brace Amid U.S. Data Drought and Fed Uncertainty

In the wake of an action-packed week, global markets remain on edge, as a prolonged U.S. government shutdown withholds vital economic data. Investors are left to decipher private reports, particularly those from ADP, to assess the labor market's direction and monetary policy implications.

The Federal Reserve's mixed messages only add to the uncertainty. Fed Chair Jerome Powell's hawkish stance last week seemed to close the door on further rate cuts this year, while Fed Governor Christopher Waller advocated for more easing. As a result, the probability of a December rate cut has decreased significantly.

Meanwhile, China's slowing factory growth and a falling euro amidst Europe's mixed signals further compound the market's challenges. Economic reports from Europe are anxiously awaited as analysts monitor whether recent global downturn patterns will persist into the week.