Markets Mixed as U.S. Government Shutdown Weighs on Sentiment Amid AI Optimism and Trade Developments

Image Source : Krish Capital Pty Ltd

Index Update:  The U.S. government shutdown entered its seventh day after both Democratic and Republican funding proposals failed again. Major tech stocks showed mixed premarket moves, with modest gains in Nvidia, Microsoft, Amazon, Meta, and Alphabet, while Apple and Tesla slipped. Trilogy Metals soared over 205% after the White House announced plans to acquire a 10% stake in the company.

Market Movers:  On Monday, the top gainers were Spruce Biosciences, Inc. (+1,378.46%), followed by Society Pass Incorporated (+275.89%). On the contrary American Rebel Holdings, Inc. (-28.37%), and Masonglory Limited (-20.32%) declined the most the same day.

Commodities Update:  WTI crude fell to $61.3 per barrel and Brent to $65.1 as investors weighed a modest OPEC+ output increase of 137,000 bpd against ongoing oversupply pressures from rising Venezuelan exports, resumed Kurdish flows, and unsold Middle Eastern barrels. Losses were capped by supply risks after Ukraine’s drone attack disrupted Russia’s Kirishi refinery. Gold prices eased to around $3,950 per ounce but stayed near record highs, supported by safe-haven demand amid the prolonged U.S. government shutdown and expectations of Fed rate cuts in October and December. Ongoing political instability in France and Japan, coupled with China’s continued gold purchases, reinforced bullish sentiment, driving a 51% year-to-date gain.

Macro Updates:  Trump Imposes 25% Tariff on Heavy-Duty Truck Imports

President Donald Trump announced a 25% tariff on all medium- and heavy-duty trucks imported into the U.S. starting November 1, citing national security concerns and the need to protect domestic manufacturers from unfair competition. The move impacts a wide range of commercial vehicles, while tariff terms for light-duty vehicles under existing trade agreements remain uncertain.

U.S. Logistics Growth Slows to Six-Month Low in September

The U.S. Logistics Manager’s Index fell to 57.4 in September 2025, signaling a slowdown in sector expansion amid broader economic uncertainty. Transportation utilization stagnated at a record-weak September level, while freight prices dipped below capacity. Inventory growth eased but costs stayed high, and warehousing activity strengthened even as prices saw a sharp decline.

Bonds Commentary:  The U.S. 10-year Treasury yield held near 4.16% as investors weighed the economic impact of the week-long government shutdown and political shifts in Japan and France. The shutdown’s continuation has delayed key data releases, while markets anticipate Fed comments and FOMC minutes. Traders largely expect quarter-point rate cuts in both October and December.

Futures Update:  U.S. stock futures were slightly lower on Tuesday as investors weighed concerns over the ongoing government shutdown against continued optimism surrounding artificial intelligence. Despite the pause, the S&P 500 and Nasdaq hit record highs in the prior session, fueled by AMD’s 23.7% surge following its major AI chip supply deal with OpenAI, which also boosted semiconductor stocks broadly.

Following a mixed performance in Friday’s trading session, stocks generally moved higher throughout the day on Monday. The S&P 500 increased by 24.51 points, or 0.36%, closing at 6,740.29. From a technical perspective, the index remained above key support levels and maintained an upward trend, suggesting potential for further gains in the near term. Additionally, the 14-day Relative Strength Index (RSI) is trending upward, reinforcing a bullish outlook. Key support levels are around 6,695, with resistance expected near 6,810.