Financial markets around the world entered the final days of September 2025 with a mix of anticipation and anxiety, as investors eyed a looming U.S. government shutdown, shifting economic data, and major leadership changes at home and abroad. Monday’s trading session on Wall Street and across Asia painted a picture of both resilience and vulnerability, with technology stocks staging a modest rebound, oil prices slumping, and gold reaching new record highs amid persistent uncertainty.
The week began with U.S. lawmakers locked in a tense standoff over the Republicans’ Continuing Resolution funding bill. If no agreement is reached, the U.S. government is set to shut down at midnight on Tuesday, September 30, 2025. President Trump, facing mounting pressure from both parties, was scheduled to meet with congressional leaders on Monday in a last-ditch effort to avert a shutdown, according to reporting from FXStreet and the Associated Press.
Despite the political brinkmanship in Washington, Wall Street showed signs of cautious optimism. As reported by the AP, the S&P 500 edged up 0.2% in afternoon trading, while the Nasdaq composite climbed 0.5%. The Dow Jones Industrial Average, however, slipped 25 points, or 0.1%. Big Tech stocks—often the bellwether for market sentiment—led the way, with Amazon rising 0.6% after last week’s 5.1% drop and Microsoft also gaining 0.6%. These modest increases provided some relief after recent volatility, but the mood was hardly euphoric.
On the flip side, energy stocks took a hit as oil prices fell sharply. Exxon Mobil dropped 2.8% and Chevron declined 2.7%, making them two of the heaviest drags on the S&P 500, the AP noted. The slide in oil was attributed to reports that OPEC+ could raise production limits next month, fueling concerns that the global market is already awash in crude. Indeed, OPEC+ was said to be planning another production hike in November, according to financial press cited by FXStreet, further pressuring prices and energy sector earnings.
While the U.S. government shutdown threat was top of mind for many investors, its direct impact on markets has historically been muted. Still, this time could be different. Jennifer Timmerman, investment strategy analyst at Wells Fargo Investment Institute, told the AP, “We believe that a shutdown will have only a small and transitory economic impact, but it may spur some financial market volatility.” One key risk: a shutdown could delay the release of crucial economic data, including Friday’s highly anticipated U.S. jobs report, which is seen as pivotal for the Federal Reserve’s next moves on interest rates.
The Fed recently delivered its first rate cut of the year, and officials have signaled more reductions could be on the way if the data justifies it. Stocks have soared from their April lows largely on expectations of easier monetary policy. The Atlanta Fed’s GDPNow forecast for Q3 was raised from 3.3% to 3.9% late last week, and the University of Michigan’s final confidence reading for September was revised slightly higher. The PCE price index for August showed no increase in inflation, while personal income outpaced expectations. All these signs have helped keep the rate-cut narrative alive, as noted by FXStreet.
However, the jobs report looms large. If the numbers are too strong, the Fed may hesitate to cut rates further, potentially stalling the stock rally. If too weak, recession fears could take hold. And if the shutdown delays the report’s release, markets could be left guessing, heightening volatility. “Without those reports, increasing uncertainty on Wall Street could make markets more twitchy,” the AP observed.
In Asia, markets largely mirrored the cautious optimism seen in the U.S. The Kospi in South Korea surged 1.6%, nearing all-time highs, while Hong Kong’s Hang Seng rose 1.4%. Japan’s Nikkei, however, underperformed with a 0.6% decline, reflecting ongoing volatility among high-yield stocks, especially those trading ex-dividend. According to FXStreet, more than 1,400 Japanese companies traded ex-dividend last Friday, adding to the turbulence.
Japan’s political scene added another layer of intrigue, with the Liberal Democratic Party (LDP) leadership race heating up ahead of the October 4th election. Polls continued to flip between contenders Takaichi and Koizumi, and Takaichi hinted at a possible review of Japan’s trade deal with the U.S. if victorious. Meanwhile, the Bank of Japan’s “hawkish split” in its recent board decision raised the odds of a potential rate hike in October, with yields on long-term Japanese government bonds inching higher.
China, for its part, reported a dramatic rebound in industrial profits, up more than 20% year-over-year in August and pulling the year-to-date figure into positive territory. Still, profits at state-owned enterprises remained negative for the year. The Chinese government also announced plans to support growth in the non-ferrous metals sector and to implement export license management for electric vehicles starting in 2026. In a bid to attract top global talent, China launched its new “K” visa program aimed at drawing the “world’s best and brightest” in science and technology, as highlighted by the New York Times and FXStreet.
Elsewhere in the region, South Korea’s Kospi opened 0.8% higher, with the country’s finance minister confirming the completion of currency negotiations with the U.S. Australia’s ASX 200 gained 0.3%, and the Hang Seng opened 0.7% higher at 26,321. In commodities, spot gold soared to a new record high of $3,800 per ounce, while silver hit a 14-year peak. Copper also climbed 1.4% amid reports of Chinese support for the non-ferrous metals market.
Back in the U.S., there were a few standout corporate stories. Electronic Arts jumped 4.6% after confirming a buyout that would make it the largest all-cash deal to take a company private, valued at over $52.5 billion. CSX rose 3.7% following the appointment of Steve Angel as CEO. Stocks in the marijuana sector soared after President Trump called hemp-derived CBD a “game changer” for seniors, with Tilray Brands surging 46% and Canopy Growth up 17.3%.
In Europe, the FTSE 100 added 0.2%, buoyed by a 2.2% rise in GSK shares after CEO Emma Walmsley announced her departure. The Hang Seng in Hong Kong jumped 1.9%, and Tokyo’s Nikkei 225 fell 0.7%—two of the day’s most notable moves in global equities. Meanwhile, gold continued its record-breaking run, topping $3,850 per ounce on expectations of Fed rate cuts and concerns over high inflation and mounting government debt worldwide.
With the U.S. government shutdown deadline fast approaching, markets are bracing for a week of potential surprises. Investors will be watching not only the outcome of Washington’s budget showdown but also the cascade of economic data, central bank decisions, and corporate news that could shape the final quarter of 2025. As the clock ticks down, the only certainty is that volatility remains the order of the day.
