Global markets react as Fed rate cuts loom ahead
- Global stock markets show mixed trading patterns with notable fluctuations in key indices.
- Traders anticipate U.S. economic data later this week that may influence Federal Reserve interest rate decisions.
- The political landscape in Japan remains uncertain as leadership changes loom, which could affect market confidence.
On Tuesday, September 9, 2025, global stock markets exhibited mixed trading patterns amid rising anticipation surrounding U.S. economic data releases scheduled later in the week. France's CAC 40 index saw a slight uptick of 0.1%, reaching 7,742.97, contrasting with the German DAX, which dropped by nearly 0.5% to 23,697.43. In the U.S., S&P 500 futures increased by 0.1% to 6,511.75, while Japan's Nikkei 225 index traded down 0.4%, closing at 43,459.29 due to ongoing political uncertainty as Prime Minister Shigeru Ishiba announced plans to resign. With potential successors, including veteran ruling party legislator Toshimitsu Motegi, the ruling Liberal Democratic Party faces a crucial period filled with concerns about maintaining its coalition. Meanwhile, South Korea's Kospi climbed 1.3% to 3,260.05. Asian markets opened with positive momentum driven by Wall Street's confidence that Federal Reserve rate cuts are not just a possibility but likely as traders anticipate nearly three cuts before the year's end. Upcoming reports relating to inflation and the economy are expected to impact these expectations, with traders uniformly forecasting a cut in the Fed's main interest rate during the upcoming meeting, which is scheduled for two Wednesdays from now. The Federal Reserve has displayed increasing concern over inflation risks, attributed in part to President Donald Trump's tariffs, focusing less on the job market. Recent reports indicating a slowdown in the U.S. job market may alter trader sentiments towards the Federal Reserve's decisions. Following the reports, updates on inflation are set to follow on Wednesday and Thursday. In energy trading, benchmark U.S. crude prices rose to $63.11 per barrel, while the U.S. dollar weakened against the yen, falling to 146.68 from 147.51. The euro was priced at $1.1757, down from $1.1765, with gold prices rising as traders responded to a falling dollar and anticipatory measures regarding the Fed's potential rate cut.