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European equity markets retreated on Tuesday, pressured by fading expectations of a near-term Federal Reserve rate cut and renewed doubts about the strength of the U.S. economy.

With financial risks building, traders remained cautious ahead of the long-delayed September U.S. jobs report and highly anticipated earnings from Nvidia (NASDAQ:NVDA), both seen as key catalysts for market direction.

The weakness was broad across the region. London’s FTSE 100 slipped 1.3%, while the CAC 40 in Paris and Frankfurt’s DAX each declined 1.5%.

Corporate news added to the mixed sentiment. Shares of Danish drugmaker Novo Nordisk (NYSE:NOV) dropped following its decision to reduce U.S. pricing for its Wegovy weight-loss injection.

Swiss industrial group ABB (BIT:1ABB) also traded sharply lower even after raising its profitability outlook, suggesting investors were hoping for more aggressive guidance.

French bank Crédit Agricole (EU:ACA) came under pressure as it unveiled its new medium-term strategy, ACT 2028.

Specialist engineering firm Bodycote (LSE:BOY) fell after introducing a revamped divisional reporting structure.

On the upside, Roche Holding (BIT:1RO) rallied after releasing positive Phase III results from its lidERA trial evaluating the oral SERD giredestrant in ER-positive, HER2-negative early breast cancer.

Imperial Brands (LSE:IMB) also advanced, supported by a nearly 5% rise in full-year adjusted operating profit.

U.S. stock futures pointed to additional weakness early Tuesday, suggesting that the market may extend the sharp selloff seen at the start of the week. Persistent pressure on high-growth technology names — especially Nvidia — continued to weigh heavily on sentiment, overshadowing modest gains in defensive sectors.

Futures tied to the Dow, S&P 500, and Nasdaq all traded in negative territory, indicating another cautious open as traders reassessed valuations across the market.

Nvidia at the center of renewed volatility

The latest downturn has been driven largely by renewed selling in tech mega-caps. Nvidia (NASDAQ:NVDA), once the undisputed engine of the artificial-intelligence boom, slipped further in pre-market trading after Monday’s steep drop. Investors appear increasingly anxious ahead of the company’s highly anticipated quarterly earnings report due after the close on Wednesday.

Because Nvidia has been the market’s key bellwether for AI-related enthusiasm, Wednesday’s results are being treated as a critical test. With analysts and investors questioning whether AI-linked spending can continue at its breakneck pace, any sign of hesitation from the company could have far-reaching effects across the tech sector — and potentially the broader market.

Alphabet (NASDAQ:GOOG) CEO Sundar Pichai added fuel to the debate during an interview with the BBC, remarking that there is a degree of “irrationality” in the current AI wave and cautioning that “no company is going to be immune” if the boom deflates. His comments reinforced broader concerns about stretched valuations within the sector.

Government shutdown delays leave investors starved of data

Another factor clouding market visibility has been the temporary blackout of key U.S. economic indicators caused by the recent government shutdown. With official releases delayed for weeks, policymakers and investors have had limited real-time insight into the strength of the labor market and the wider economy.

Some data has now started to resurface. On Monday, the Commerce Department unexpectedly reported a modest increase in August construction spending — a rare bright spot in an otherwise uncertain landscape. Still, the report covers a period long before the shutdown, limiting its usefulness.

The most important piece of delayed data — the September nonfarm payrolls report — is set to be released on Thursday and is widely expected to shape expectations for the Federal Reserve’s December meeting. Markets remain split on whether the Fed will cut rates this year or wait for stronger evidence of cooling economic conditions.

Monday’s selloff highlights growing fragility

Monday’s session was marked by a sharp and broad retreat across risk assets. All three major averages sank to their lowest closing levels in about a month after an early attempt at direction gave way to steady selling throughout the afternoon.

Although the indices staged a mild rebound just before the closing bell, the declines were still notable:

• Dow Jones Industrial Average: –557 points (–1.2%)
• Nasdaq Composite: –192 points (–0.8%)
• S&P 500: –62 points (–0.9%)

The slump highlighted growing investor unease about the sustainability of equity valuations — especially in tech — at a time when interest rates remain elevated and economic signals mixed.

Sector breakdown: airlines, banks, housing lead the declines

Several major sectors experienced heavy losses Monday, underscoring the breadth of the downturn:

• Airlines were among the worst performers, with the NYSE Arca Airline Index falling 3.7% to its lowest close in more than three months as fuel costs, slowing travel demand, and recession fears converged.
• Financials struggled as bond-market volatility pressured lenders and brokerages alike. The KBW Bank Index and the NYSE Arca Broker/Dealer Index both posted declines exceeding 2.5%.
• Housing stocks dropped 2.7%, reflecting ongoing softness in the real-estate market as high mortgage rates continue to choke affordability.
• Semiconductors, energy, and networking stocks also pulled back sharply as investors rotated away from cyclical and growth-sensitive areas.
• Utilities, often considered a haven during periods of volatility, were one of the few sectors to show modest strength.

Looking ahead

With Nvidia’s earnings looming and delayed economic data beginning to filter back into the market, traders are preparing for a potentially volatile stretch. The combination of elevated valuations, policy uncertainty, and shifting expectations for AI-driven growth has created a fragile environment where even small surprises can lead to outsized market reactions.

For now, futures suggest the path of least resistance remains to the downside — unless incoming data or Nvidia’s update on Wednesday offers a compelling reason for investors to step back in.

Bitcoin (COIN:BTCUSD) slid below $90,000 on Tuesday, marking its weakest level in almost seven months as growing doubts about a Federal Reserve rate cut and a lack of fresh U.S. economic data pushed traders out of risk-heavy positions.

The token was last down 5.4% at $90,091.5 as of 00:22 ET (05:22 GMT), after briefly dipping to $89,471.4 — a drop of nearly 30% from the late-October high above $126,000. Momentum worsened after Bitcoin broke its $94,000 support and triggered a bearish technical “death cross.”

Concerns over the December Fed meeting dominated sentiment, especially after policymakers, including Chair Jerome Powell, indicated they were not yet ready to ease policy further. The absence of timely U.S. data following the government shutdown has added another layer of uncertainty.

Outflows from spot Bitcoin ETFs and steep declines in crypto-related equities also pressured the market, while the latest wave of forced liquidations in derivatives trading accelerated the downturn. Analytics firms estimate that more than $19 billion in leveraged crypto positions were wiped out in a single day earlier this month.

Bitcoin’s retreat to levels last seen in April underscores how quickly confidence has deteriorated amid geopolitical tensions and shifting expectations for U.S. policy moves.

Altcoins tumbled in tandem: Ethereum dropped 5.6%, XRP lost 4.4%, Solana slipped 4%, Cardano fell 5%, and Polygon retreated 3%. Meme coins also weakened, with Dogecoin down 4% and $TRUMP edging 1% lower.

Oil prices retreated on Tuesday, losing close to 1%, after Russia restored crude loadings at a major export terminal that had been briefly knocked offline by a Ukrainian drone and missile attack. With the immediate disruption resolved, traders shifted their attention back to the broader implications of Western sanctions on Moscow’s energy flows.

By early London trade, Brent crude slipped 0.9% to $63.64 a barrel, while U.S. WTI also fell 0.9% to $59.37.

Loadings at Russia’s Novorossiysk port resumed over the weekend following a two-day halt, according to industry sources and LSEG data.

Analyst Tony Sycamore of IG said crude was under pressure “as reports indicate that loadings have resumed sooner than expected at Novorossiysk.”

Exports from Novorossiysk and the adjacent Caspian Pipeline Consortium terminal — together equal to roughly 2% of global supply — had been frozen since Friday, sending prices higher during the prior session.

Washington has argued that sanctions rolled out in October targeting Rosneft and Lukoil are already squeezing Russia’s export revenues, with expectations that volumes will fall over time.

ANZ Research added that Russian barrels are now trading at a notable discount to international benchmarks.

Vivek Dhar of Commonwealth Bank of Australia said “market worries centre around the build-up of oil on tankers as buyers assess the risk of potentially breaching sanctions,” but he also noted Russia’s track record of adapting: “We expect any disruption from U.S. sanctions will prove temporary as Russia finds ways to circumvent sanctions once again.”

In the U.S., geopolitical considerations added to market caution. A senior White House official said President Donald Trump would sign new sanctions legislation on Russia provided he keeps final authority over how it is applied. Trump also said Republicans are preparing a bill to penalize any country conducting business with Russia, potentially including Iran.

Forecasts from Goldman Sachs on Monday pointed to weaker oil prices through 2026 due to a wave of additional supply, though the bank said Brent could push above $70 a barrel in 2026–27 if Russian output sees a steeper drop.

Gold prices weakened again on Tuesday during Asian trading hours, pressured by a firmer U.S. dollar as investors pulled back from earlier bets on a Federal Reserve rate cut next month. The shift in sentiment, combined with anticipation surrounding this week’s September nonfarm payrolls release, added to headwinds for precious metals.

Spot gold slipped 0.7% to $4,019.19 per ounce, while December futures dropped 1.4% to $4,018.89. The metal has now erased most of last week’s gains.

Rate-Cut Optimism Fades as Focus Turns to Labor Data

The decline came as the market dialed down the likelihood of a December policy easing.
The extended government shutdown delayed a raft of economic reports, leaving traders worried the Fed may be forced to make decisions with incomplete data.

Thursday’s payrolls release is expected to provide the final major reading on hiring conditions before the Fed meets on December 10–11.
Futures markets now show a 42.4% chance of a 25-basis-point trim and a 57.6% probability of rates staying unchanged.

A higher-for-longer rate environment reinforces the appeal of Treasuries, diminishing the relative attractiveness of gold.

Dollar Strength Adds Pressure Across Metals

The U.S. dollar has rebounded sharply in recent days, weighing not only on gold but on the broader metals complex.

Platinum and silver each slipped 0.7%, and LME copper futures lost 0.8%, partially unwinding last week’s strength.

Dollar demand has been buoyed by expectations that U.S. interest rates will remain elevated and by mounting fiscal concerns in major economies — Japan in particular.
A surge in long-term Japanese bond yields sent the yen tumbling and pushed more investors into the greenback.

The U.S. dollar edged lower on Tuesday, pressured by fresh dovish comments from the Federal Reserve as markets braced for a wave of economic releases that could influence policymakers’ final rate decision of 2025.

Around 04:15 ET (09:15 GMT), the Dollar Index eased 0.1% to 99.410, resuming its broader slide after a brief pause at the start of the week.

Waller’s Warning Sends the Dollar Lower

The greenback lost momentum after Fed Governor Christopher Waller highlighted signs of stress emerging in the labor market and renewed his call for another quarter-point rate cut at the December 9–10 meeting.

“Four to six weeks ago, we were still in this kind of no-hire, no-fire mode,” Waller said in London. He noted that executives are increasingly saying “they’re starting to talk about layoffs. They’re starting to plan for them.”
He added: “It could be AI-related. It could be a lot of other things … It’s not just going to be ’no hire, no fire.’ At some point this is going to start happening.”

His comments contrasted with more cautious tones from other Fed officials, leaving markets unsure about the committee’s next step.

With the federal government reopened, a backlog of important indicators will be released this week, including Thursday’s September nonfarm payrolls.

ING analysts wrote: “Our base case remains that risks are tilted to the downside for the dollar once the U.S. data cycle kicks in, and we expect a December Fed cut to become the market’s base case again.”

Rate-cut odds now hover near 40%, down sharply from last week.

Euro Supported as ING Flags Upside Potential

EUR/USD crept higher to 1.1593, reversing a multi-session decline.

ING maintained an optimistic view, saying “upside risks for EUR/USD persist.”
The bank added: “Our year-end target remains 1.180… positive December seasonality could help smooth the move.”

Sterling slipped slightly to 1.3152 as traders awaited U.K. budget details from Finance Minister Rachel Reeves.

Yen Firms as Japanese Yields Touch Long-Time Highs

USD/JPY dropped 0.2% to 154.96 as the yen strengthened from nine-month lows.
Long-term Japanese government bond yields surged to levels not seen in decades, reflecting concerns that Prime Minister Sanae Takaichi’s expected fiscal package could further expand Japan’s debt load.

Reuters reported that Goushi Kataoka believes a stimulus package worth around $149 billion is needed to support the economy.

Elsewhere, USD/CNY rose 0.1% to 7.1117 while AUD/USD held steady at 0.6493.

U.S. stock futures edged lower early Tuesday as investors braced for another volatile session following a broad selloff that swept through global markets. Concerns over whether the recent frenzy around artificial intelligence can be sustained weighed heavily on equities, gold, and Bitcoin, with major Wall Street benchmarks falling through a key technical indicator used to gauge near-term momentum. The day also brings fresh insights into U.S. consumer health as Home Depot prepares to report earnings, while Microsoft opens a high-profile developers event where its AI strategy is expected to take center stage.

Futures Extend Losses

Futures tied to the major U.S. indices pointed to continued weakness after Monday’s sharp drop.
As of 03:12 ET, Dow futures were down 146 points, or 0.3%. S&P 500 futures slipped 28 points, or 0.4%, and Nasdaq 100 futures fell 124 points, or 0.5%.

All three major benchmarks closed below their 50-day moving averages on Monday — a level closely monitored by traders for signs of shifting market direction. Selling intensified into the afternoon, with tech stocks bearing the heaviest losses. Nvidia (NASDAQ:NVDA), which reports critical quarterly numbers later this week, fell 1.9%, dragging peers such as Advanced Micro Devices (NASDAQ:AMD) and Super Micro Computer (NASDAQ:SMCI) lower.

Analysts at Vital Knowledge said traders appeared “jittery” and “nervous”, particularly after Amazon’s (NASDAQ:AMZN) $12 billion bond issuance stoked fears that massive AI-related spending on data centers is increasingly being funded through debt rather than cash flow or equity.

Even a fresh record high for Alphabet (NASDAQ:GOOG) — helped by a new stake from Warren Buffett’s Berkshire Hathaway (NYSE:BRK.B) — was not enough to stabilize sentiment.

Waller Repeats Call for December Rate Cut

Despite the downturn, stocks saw a modest late-day bounce after Federal Reserve Governor Christopher Waller again pushed for a December rate cut. Waller pointed to private-sector hiring data — used temporarily during the federal shutdown — suggesting the labor market was moving at “stall speed” in September and October.

He argued that another quarter-point cut at next month’s meeting would “provide additional insurance against an acceleration” in the cooling of employment conditions.

Still, the December decision remains uncertain. Several Fed officials have cautioned against reducing rates until full government-issued data becomes available and shows more definitive signs of weakness.

Home Depot Earnings Take Center Stage

Home Depot (NYSE:HD) headlines today’s corporate calendar, kicking off a week packed with retail results that could offer clearer visibility into consumer spending patterns. Shares of the home-improvement chain have dropped more than 8% over the past month, reflecting growing investor caution around discretionary spending and the broader housing market slowdown.

Rising raw-material costs — exacerbated by President Donald Trump’s wide-ranging import tariffs — have pressured margins for Home Depot and rival Lowe’s (NYSE:LOW). Both retailers have passed higher costs on to customers, although analysts believe last month’s trade thaw between Trump and China’s President Xi Jinping may reduce some of the cost burden going forward.

Strategists also note that lower interest rates from the Fed could help revive demand for renovation and DIY projects that homeowners have postponed due to high borrowing costs.

Consensus estimates call for a 1.5% increase in comparable sales for Home Depot’s third quarter, reversing a 1.3% decline a year earlier, according to LSEG data cited by Reuters.

Microsoft Developer Conference to Spotlight AI Infrastructure

Microsoft (NASDAQ:MSFT) opens its annual developer conference today in San Francisco, where investors expect new details on the company’s aggressive data-center expansion tied to surging AI demand.

A recent report from The Wall Street Journal said Microsoft plans to build next-generation two-story AI “super factories” in Georgia as part of an effort to double its global data-center footprint within two years. The facilities would be used to help train the company’s proprietary AI models.

In the fiscal first quarter alone, Microsoft spent over $34 billion on capital investment and signaled further increases ahead — part of a broader wave of AI spending that could reach $400 billion this year across the tech giants.

Bitcoin Wipes Out All 2025 Gains

Bitcoin (COIN:BTCUSD) briefly dipped below $91,000 early Tuesday in the latest leg of a deepening downturn that has spilled over into the wider crypto sector. The cryptocurrency has now erased all gains accumulated in 2025 and trades more than 25% below its record high reached just over a month ago.

Analysts note that mounting uncertainty over the U.S. economic outlook and the Fed’s rate trajectory has dimmed the appeal of speculative assets. Spot Bitcoin ETFs are also seeing rising outflows as investors unwind positions built around expectations of looser monetary policy.

European equities tumbled on Tuesday, mirroring the steep selloff seen overnight on Wall Street as renewed concerns over stretched technology valuations weighed heavily on sentiment ahead of Nvidia’s closely watched earnings report.

At 08:05 GMT, Germany’s DAX fell 1.3%, France’s CAC 40 slid 1.3% and the U.K.’s FTSE 100 dropped 1%.

AI Valuation Fears Drag Global Markets Lower

Investors continued to pull back from mega-cap tech stocks amid rising doubts about the sustainability of AI-driven valuations. Ahead of Nvidia’s latest quarterly results, due Wednesday, traders dumped high-growth names, sending the major U.S. indices sharply lower: the Dow Jones Industrial Average fell more than 500 points (1.2%), while the S&P 500 and Nasdaq Composite also ended in the red.

Alphabet CEO Sundar Pichai cautioned in a BBC interview that “every company would be affected” if the AI boom were to unwind. He described the surge in AI-linked investment as an “extraordinary moment,” while also pointing to signs of “irrationality” creeping into the current enthusiasm.

Concerns about overheating come as questions mount over Nvidia’s meteoric valuation expansion — a move that has underpinned broader AI market optimism over the past three years.

Focus Shifts to U.S. Data as Government Reopens

Europe’s economic calendar is light on Tuesday, leaving attention squarely on the U.S. as fresh datasets begin to emerge following Washington’s federal government reopening.

August factory orders are due later in the day, but the market’s primary focus remains on Thursday’s September nonfarm payrolls report, which will provide important clues about labour-market momentum and future Federal Reserve decisions.

Fed Governor Christopher Waller on Monday warned of risks facing the job market and called for policymakers to support another 25-basis-point cut at the December 9–10 FOMC meeting.

Rate-cut expectations have wavered: CME FedWatch now shows markets pricing in roughly a 40% chance of a December cut, down from 55% the previous week.

Corporate Headlines: Imperial Brands, Crest Nicholson, Akzo Nobel

Across Europe, company news added further movement to individual stocks:

• Imperial Brands (LSE:IMB) reported a nearly 5% increase in annual adjusted operating profit, driven by higher pricing and growing demand for reduced-risk products.
• Crest Nicholson (LSE:CRST) warned its full-year profit is likely to land at the lower end — or slightly below — prior guidance due to continued housing-market softness and uncertainty surrounding upcoming tax policy decisions.
• Akzo Nobel (EU:AKZA) confirmed plans to merge with U.S. rival Axalta Coating Systems (NYSE:AXTA) in a deal that will create a combined paint and coatings business valued at about $25 billion.

Oil Slips as Russian Exports Resume

Oil prices weakened as supply concerns eased following the restart of operations at Russia’s key Black Sea export hub.

Brent crude fell 0.9% to $63.64 a barrel, while West Texas Intermediate slid 1% to $59.29.

Russia’s Novorossiysk port resumed loadings on Sunday after a two-day halt caused by a Ukrainian drone and missile strike. Exports from Novorossiysk and the nearby Caspian Pipeline Consortium account for roughly 2.2 million barrels a day — around 2% of global supply.

WPP (LSE:WPP) saw its shares fall roughly 3% on Tuesday after Havas Group publicly denied media claims suggesting the two advertising giants had explored merger options or potential investment deals.

The drop came after reports from The Times and other outlets indicated that Havas — along with private-equity firms such as Apollo Global Management and KKR — had assessed a range of possible transactions involving WPP. These scenarios reportedly included anything from the acquisition of a minority stake to a full buyout or bids for selected divisions.

WPP has been under persistent pressure throughout the year. Its market capitalisation has slipped to around £3 billion, and the company has issued profit warnings while undertaking a broad restructuring led by its new CEO, Cindy Rose.

Havas moved quickly to quash the rumours. In an email sent to employees on Monday and obtained by Bloomberg, CEO Yannick Bolloré said the company was “not in discussions with WPP.” He added that Havas remains focused on smaller, targeted acquisitions rather than large, transformative deals like those described in recent reports.

The clarification dampened the takeover speculation that had driven WPP’s share price higher in the previous session. Analysts noted that Tuesday’s reaction reflected investors’ uncertainty over WPP’s strategic direction and the lack of clarity around any potential dealmaking.

Private-equity interest in WPP has resurfaced periodically in recent months, largely due to the group’s depressed valuation and rapid industry shifts toward data-driven, technology-enabled, and AI-powered marketing services. However, no firm has publicly confirmed active negotiations.

ICG Plc (LSE:ICG) jumped more than 8% on Tuesday after the alternative asset manager released first-half fiscal 2026 results that comfortably beat analyst expectations and unveiled a new 10-year global distribution agreement with Amundi.

For the six months to September 30, 2025, the Fund Management Company division delivered pre-tax profit of £325 million — 23% above the consensus forecast of £263 million. The business reported an operating margin of 67.1%, well ahead of expectations of 60.7%. Fundraising totalled $9 billion, significantly surpassing the estimated $5.4 billion, with strong inflows from Europe IX and Infrastructure II, though slightly below the $10 billion raised in the prior-year period.

By strategy, structured capital and secondaries accounted for $4 billion, real assets brought in $3.3 billion and debt strategies added $1.7 billion. Europe IX attracted $2.8 billion in commitments, including $1.3 billion secured in Q2, while Infrastructure II closed at €3.1 billion. The firm also confirmed plans to launch LP Secondaries II later this fiscal year.

Fee-earning AUM reached $83.8 billion, beating the consensus estimate of $81.7 billion and rising from $73 billion a year earlier. Total AUM increased to $124 billion. Management fees advanced 16% year over year to £334 million, 7% above expectations, supported by £38 million in catch-up fees and a 98-basis-point fee margin. Performance fees surged to £98 million, outstripping the forecast £84 million and more than tripling last year’s £32 million, helped by the initial recognition of Mid-Market I, Europe VIII and Strategic Equity IV under the revised fee framework introduced in October.

Operating expenses for the Fund Management Company came in at £159 million — 6% below consensus and unchanged from last year — while divisional revenue reached £484 million, beating expectations of £433 million.

In the Investment Company division, net investment return totalled £72 million, below the forecast £115 million but still higher than last year’s £48 million. The balance sheet investment portfolio was valued at £2.8 billion, slightly below the £3 billion reported in H1 FY25. Returns were positive in structured capital (9%) and real assets (5%), but debt declined 9% and seed investments were down 3%. Pre-tax profit for the segment was £27 million, compared with a consensus expectation of £39 million.

At the group level, pre-tax profit rose to £352 million, ahead of the £299 million forecast and up sharply from £198 million a year earlier. Fully diluted EPS reached 103 pence, easily surpassing the expected 84 pence and improving from 58 pence last year. The interim dividend was declared at 28 pence, matching estimates and up from 26 pence. Net asset value per share rose to 900 pence, ahead of the 890-pence forecast and up from 788 pence.

ICG also announced a major strategic development: a 10-year partnership under which Amundi will serve as the exclusive global distributor for selected ICG products within the wealth channel. As part of the arrangement, Amundi will acquire a 9.9% economic stake through a structured transaction. ICG said it plans to counteract dilution via a share buyback by the first half of 2027.

The group reaffirmed its medium-term targets, including at least $55 billion of fundraising across fiscal 2025–2028, Fund Management Company margins above 54%, performance fees contributing 10–20% of overall fee income and low double-digit returns from balance sheet investments.