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MORNING BID EUROPE-Washington goes dark

Stella Qiu gives us a look at what the future holds for European and global markets.

The U.S. Government has now entered its 15th government shutdown since 1981, and second under Donald Trump. He took the opportunity to threaten dismissal of more federal employees.

The biggest federal exodus since 1980 is about to happen this week. Over 150,000 employees will be leaving the payroll after a buyout. The FAA will furlough about a quarter its staff during the shutdown, so if you are planning to fly in the U.S. soon, be aware.

Trump's new tariffs will also go into effect on Wednesday. These include the tariffs on big trucks and patented drugs. The administration has stated that tariffs will be collected even if the government shuts off.

All of this is set to increase concerns at the Federal Reserve over a slowing labour market. Investors bet that the Fed will cut rates this month despite the lack of economic information. Prices are 96% higher than they were just one day ago.

S&P futures and Nasdaq Futures both fell 0.5% today - a small move given the rally in share markets this year. S&P 500 futures have averaged 12 gains, 9 losses and a median increase of 0.1% during the 21 previous shutdowns.

This uncertainty has provided gold bulls with a good excuse to promote the idea of purchasing assets outside the control of the government, causing the metal to reach a new record of $3.875 per ounce. Silver and platinum have also been on an upswing.

The Asian session has been mixed, as Chinese markets are closed for the National Day holiday. Japan's Nikkei fell 1% but Taiwan rose 1% and South Korea gained 0.8%.

Investors are not frightened by the lack of data due to the shutdown, but they do worry about the data vacuum. There's no payrolls report for you to bet on.

The ADP National Employment Report will be released later today. The forecasts predict a modest increase of 50,000 jobs in the private sector as the labour markets continues to cool. The JOLTS report released on Tuesday showed that hiring was weak. It is not clear whether this weakness is due to AI or tariffs, but it could be something longer-lasting.

The euro zone's inflation data for September is expected to show an increase in inflation to 2.2%, up from the previous 2%. The risks could be on the upside, after German inflation was higher than expected.

The hot number could indicate that the European Central Bank has likely finished easing in this cycle, and give a reason for going long on euros.

The following are key developments that may influence the markets on Wednesday.

Eurozone HICP Flash Inflation Readings for September

-- ISM US Manufacturing survey

ADP Private Payrolls

(source: Reuters)