Market Wrap & Economic Data

U.S. Markets Rise: U.S. stocks advanced (S&P 500 up 0.7%, Nasdaq 100 at a record high) as weak labor market data lowered expectations for near-term Federal Reserve rate hikes. Money markets are now pricing less than a 25% chance of an October rate increase.
Jobs Report Details: Nonfarm payrolls grew by only 29,000 in September (missing all forecasts) along with downward revisions for prior months, while unemployment ticked up to 4.2%.
Bond Market Relief: The weak jobs numbers provided relief to Treasuries following a selloff that had pushed 10-year yields to 2002 highs, driven by inflation concerns and corporate borrowing for AI investment.

Energy & Geopolitics

Energy Policy & Trump Remarks: President Trump clarified that a diesel export ban "was never really on the table" and noted that Europe and the U.S. are both making contributions to supply relief. G7 nations signaled plans to release emergency diesel and crude reserves.
Trade & Defense: Trump mentioned charging South Korea more if they do not participate in the Alaska pipeline project. Additionally, the U.S. Army is establishing an Autonomous Systems Command.

Currencies: Hedge funds turned net short on the British pound for the first time since 2024 (-91,075 contracts) and turned net short on the Japanese yen (though speculators hold a net long of 55,440 contracts). Euro net short positions stand at -63,256 contracts.
Treasuries & Equities: Speculators increased net short positions across 5-year, 10-year, and Treasury bond futures, while trimming 2-year and UltraBond shorts. Equity fund managers reduced S&P 500 net long positions by 33,658 contracts.