Caution Reigns as Gold Shines Bright in Risk-Off Trade

Here’s your quick read to start the day: a chatty, no-fuss look at overnight moves, the big story, what’s on the docket, and the tickers you need to watch.

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By Richard Fargose

October 8, 2025 at 1:34 AM IST

GLOBAL MOOD: Risk-off
Drivers: US Government Shutdown, Safe-haven demand

Markets remained cautious and slightly risk-averse amid mixed signals from the US Federal Reserve and ongoing political uncertainty due to the prolonged government shutdown. Safe-haven demand increased, reflected in gold prices surging past $4,000, while equities showed selective strength in tech sectors. Global investors are watching US economic policy closely for indications of interest rate moves.

TODAY’S WATCHLIST
 - US FOMC Minutes
 - ECB President Lagarde Speech

THE BIG STORY

Federal Reserve officials struck contrasting tones on Tuesday as debate over the pace and impact of potential rate cuts intensified. Governor Stephen Miran argued that the bond market’s current stability supports a swift reduction in interest rates, suggesting that recent market behaviour validates his view for faster easing. Meanwhile, Minneapolis Fed President Neel Kashkari cautioned that massive investments in AI infrastructure could keep borrowing costs elevated, even if the Fed lowers its policy rate, as capital is diverted from housing to higher-yielding data centres. Adding political pressure, President Trump reiterated his call for aggressive rate cuts to ease housing costs, while appointing a new Fed governor aligned with his views on immigration and inflation.

Amid these developments, US gold futures surged past the $4,000 per ounce mark for the first time, fuelled by expectations of imminent rate cuts and continued safe-haven demand amid the prolonged government shutdown.

Data Spotlight
Americans became more cautious about the job market in September, according to the New York Fed’s latest Survey of Consumer Expectations. Respondents anticipated higher unemployment over the next year and a greater likelihood of job loss, though confidence in finding new employment if displaced also improved. While households viewed their current financial situation more favourably, optimism for the year ahead dipped slightly, with respondents planning to reduce future spending. Inflation expectations edged higher, with one-year-ahead expectations rising to 3.4% from 3.2% in August, while three- and five-year expectations held around 3%, remaining above the Fed’s 2% target.

Takeaway: Consumers are showing growing unease about job security and inflation, signalling a cautious outlook that could dampen spending and reinforce the Fed’s watchful stance on price pressures.

WHAT HAPPENED OVERNIGHT

  • US stocks slipped as data blackout; Fed remarks kept investors cautious
    • US stocks closed lower on Tuesday amid the ongoing government shutdown, which has stalled key economic data releases.
    • A New York Fed survey showed worsening consumer expectations and higher inflation outlook, adding to the cautious mood.
    • AMD rose 3.8% following an upgrade to “buy” by Jefferies and renewed optimism after its AI chip supply deal with OpenAI.

  • US Treasury yields eased amid Fed rate-cut expectations; shutdown uncertainty
    • 10-year US Treasury yield slipped 3.5 bps to 4.13%, easing after two sessions of gains.
    • A strong three-year note auction signalled solid investor demand for government debt.
    • Markets remained confident the Federal Reserve will cut rates at its next meeting.
    • The ongoing U.S. government shutdown, now in its seventh day, added to investor caution and muted

  • US Dollar rose as political uncertainties boosted safe-haven demand
    • The US dollar index climbed for a second straight session to 98.6, its highest level in nearly four weeks.
    • The greenback was supported by weakness in the euro and yen, amid ongoing global political uncertainty.
    • Japan’s fiscal concerns pushed the yen to a seven-month low against the dollar, while turmoil in France weighed on the euro.

 

  • Crude oil prices held steady weighed supply and demand factors
    • Brent crude oil prices were largely steady on Tuesday as OPEC+’s smaller-than-expected production hike for November provided price support.
    • Concerns of a potential supply glut capped gain.
    • Brent crude was down 0.03% to $65.45 per barrel, WTI crude was up 0.06% to $61.73 per barrel.



Day’s Ledger

Economic Data

  • US FOMC Minutes
  • Japan Aug Current Account
  • RBA Annual Report 2025
  • Japan Sep Bank Lending

Corporate Actions

  • Jul-Sep Earnings: Madhya Bharat, Mega Nirman, Saatvik Green, Saptak Chem
  • Adani Enterprises to consider fund raising
  • Capital Infra Trust to consider fund raising
  • Delphi World to consider right issue
  • Enbee Trade to consider right issue
  • IRB Invit Fund to consider fund raising
  • Ugro Capital to consider fund raising
  • Utkarsh Small Finance Bank to consider right issue

Policy Events

  • Fed Musalem Speech
  • Fed Barr Speech 
  • Fed Miran Speech
  • ECB Tuominen Speech
  • ECB Buch Speech
  • ECB Elderson Speech
  • BoE Pill Speech
  • ECB President Lagarde Speech


Tickers to Watch

  • GODREJ CONSUMER expects standalone operations to post mid-single-digit value growth in Q2.
  • ANANT RAJ’S qualified institutional placement opens Tuesday; floor price set at ₹695.83 per share.
  • CCI approves LLOYDS METALS’ acquisition of a 49.99% stake in Thriveni Pellets.
  • TITAN reports 20% on-year growth in Jul–Sept consumer business, driven by all segments.
  • AXIS BANK says it is keen to enter acquisition financing, pending RBI guidelines.
  • DABUR expects mid-single-digit growth in Q2, says GST rate cuts have impacted business.

  

Must Read

  • SEBI to deploy AI tool to track misleading ads, finfluencer content
  • India-EU trade talks: Commerce Secretary to visit Brussels this week
  • Amit Shah, Sitharaman meet Tata Group trustees amid boardroom dispute
  • Lagarde Sees Lasting Benefits in Strengthening Euro’s Foundation
  • Trump Says US and Canada Working on Formula for Tariff Deal
  • No green light: How the US shutdown just slammed the brakes on America’s $30 billion worth of IPO boom
  • When RBI Rules Push a Tata Giant to Market, Unexpected Openings Emerge
  • Japan’s First Woman PM Faces Big Tests, And India Has a Stake in the Outcome
  • Traders Should Brace For Shock From GIFT City’s Daily Option Expiry Push 


See you tomorrow with another edition of The Morning Edge.

Have a great trading day.

When the State Enters the Boardroom

India’s capitalism was born out of permission, not freedom, and that legacy lingers.

Reports of the government’s quiet outreach to mediate tensions within Tata Trusts highlight a deeper question: how far should the State go to preserve stability without eroding corporate autonomy?


Srinath Sridharann writes, the instinct to step in may seem prudent, especially when a crisis brews in an institution as emblematic as the Tata Group. But each such intervention, however well-intentioned, risks blurring the line between reassurance and interference.

The maturity of India’s markets will ultimately be measured not by how quickly the government acts in corporate crises, but by how confidently it can step back.