American Markets Retreat from Records Amid Earnings, Shutdown Uncertainty

U.S. equity markets retreated modestly on Thursday after setting intraday records, with the S&P 500 and Nasdaq pulling back from Wednesday’s closing highs. The Dow posted the steepest percentage decline among major indices. Investors consolidated positions ahead of the Q3 earnings season and amid uncertainty from the nine-day government shutdown.

Within the tech sector, Nvidia and AMD surged on strong chip demand, while Apple, Microsoft, and Amazon dragged on the indices. Q3 earnings begin next week with major financials reporting-Goldman Sachs, BlackRock, Citi, JPMorgan, and Morgan Stanley. Attention will focus on tariff-impacted consumer and retail sectors. PepsiCo exceeded Q3 expectations on strong demand for healthier beverages and energy drinks. Delta Air Lines reported minimal damage from the shutdown despite concerns over flight delays from furloughed federal workers.

Federal Reserve: Minutes from the Fed’s September meeting reinforced expectations for at least two rate cuts in 2025. Officials emphasised labour market risks and softening inflation, which had bolstered equities and crypto earlier in the week.

Government Shutdown: The federal government shutdown entered its ninth day with no resolution in sight. Republicans and Democrats remain deadlocked over a temporary funding bill, with Democrats demanding extended Obamacare tax credits. The impasse may delay upcoming economic data releases.

Commodities: Gold fell below $4,000/oz after briefly surpassing that milestone, marking its biggest decline in two months. Profit-taking and dollar strength offset safe-haven demand from the shutdown, Japanese fiscal concerns, and France’s political crisis. A Gaza ceasefire between Hamas and Israel further reduced safe-haven flows.

Oil slipped 1.6% to near $65/bbl on reduced Middle East supply risk following the Gaza ceasefire announcement. Higher U.S. inventories, as per EIA data, added downward pressure.

Cryptocurrencies: Bitcoin consolidated around $120,000 after hitting an all-time high above $126,000. Large options expiries and over $700M in liquidations triggered short-term volatility, though robust institutional flows into spot ETFs provided support.

Broad-Based Buying Lifts Nifty in yesterday’s session.

Nifty resumed its uptrend by rising 135 points or 0.54%, to close at 25181 yesterday. After an initial hour of volatility, the index maintained a positive trajectory for most of the session. Momentum was broad-based across sectors, signalled by positive market breadth and advances in IT, metals, and pharma.

TCS delivered strong operating margins of 25.2% (+70bps QoQ). This performance came despite continued macro challenges and uncertainties that compelled clients to keep tight control over their discretionary budgets.

Positional trend of the Nifty remains positive as it continues to be placed above its near-term averages. Immediate resistances for the Nifty are seen at 25220 and 25448. On the downside, 25000 could offer immediate support.

Indian markets are expected to open a little subdued on the back of weak global cues.

Source: HDFC Securities Prime Daily, 10 October 2025

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