US markets gained in September despite weak job data and a looming government shutdown. After negative revisions of the nonfarm payrolls in June and July by a staggering 250000 jobs, news jobs in August amounted to only 22000, well below the anticipated 75000 new jobs. As the government effectively did shut down in early October, there has been no report for the September figures. Neither are US inflation numbers reported with the government shutdown, leaving the Federal Reserve guessing what to do with the interest rate. Nonetheless the FED did finally cut the interest rate by a modest 0,25% in September on increasing pressure of the job market despite gradually increasing inflation.

Strong corporate earnings and renewed enthusiasm for AI, along with expectations of further rate cuts drove the indexes up. The Dow Jones index gained 1,87%, the S&P500 3,53% and the Nasdaq Composite 5,61%. The dollar remained fairly stable, closing at 1,1734 against the Euro.

Eurozone equity markets mostly gained in September. The financials and healthcare sectors led the advance. Bank shares in particular were buoyed by some strong corporate earnings. The german DAX underperformed, losing a slim 0,09% while the French CAC index gained 2,49%, despite political turmoil in France. Incoming prime minister Sebastien Lecornu was appointed in September after François Bayrou's government collapsed when others refused to back his budget. However in the early days of October also Lecornu resigned after just 28 days on the job.

European Central Bank (ECB) President Christine Lagarde acknowledged that the significant inflation spike experienced between 2022 and 2024 has subsided, and inflation risks are currently balanced.

The Eurostoxx 50 index gained 3,33% while the Slovene SBITOP index added 3,76% to close at 2504,9, breaching the 2500 level for the first time since early 2008. In the UK, the FTSE index gained 1,78% while the Pound Sterling lost 0,84% against the Euro.

The Japanese equity market gained once again with the Nikkei 225 index up 6,17%. Japan's prime minister Shigeru Ishiba resigned with conservative Japanese lawmaker Sanae Takaichi a potential candidate to take over the reigns. If chosen, she would be Japan's first female prime minister. Her prime concern is inflation which she wants to lower while simultaneously opposing raising interest rates.

Hong Kong shares made strong gains with the Hang Seng index adding 7,09% in September, boosted by US-China trade talks and the FED's interest rate cut.

Gold futures popped 10,28% in September reaching a new all-time high just shy of $3900 per ounce.  amid expectations of further FED interest rate cuts and uncertainty as the US-China trade tensions escalate again. Brent Oil futures on the other hand dropped by 2,49% as the trade tensions between the US and China, the world's two largest consumers, may negatively affect demand while OPEC+ intends to increase production, raising concerns of oversupply.

Rudy Marchant
Fund manager Primorski skladi

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