Global Markets React to US Government Shutdown
US futures and global markets show mixed reactions following the onset of a US government shutdown. While US markets saw a minor drop, Asian and European indices displayed varied trends. The political situation in Japan and financial adjustments in China added further layers of complexity to the market dynamics.
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On Wednesday, US futures dipped alongside a mixed performance in global markets as a US government shutdown commenced. The S&P 500 fell 0.8%, and the Dow Jones Industrial Average lost 0.7%. Despite the downturn, both indices had reached record highs a day earlier.
European markets reflected a similar caution, with Germany's DAX down 0.3% and France's CAC 40 decreasing by 0.1%. In contrast, Britain's FTSE rose 0.4%. Japan's Nikkei 225 saw a decline of 0.9% due to political uncertainty as the country awaits a new prime minister. Meanwhile, China's financial activity slows during a National Day holiday, though plans for a reverse repo operation aim to boost liquidity post-holiday.
In the broader market landscape, the ongoing US government shutdown has left investors wary, as international markets adjust to potential ripple effects. Despite historical precedents of minimal economic impact from shutdowns, concerns linger over its implications on Federal Reserve's interest rate decisions and US employment data releases.
(With inputs from agencies.)
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