Weekly-Financial-Review-

A Week of Records and Red Flags: Global Markets Grapple with a Data Blackout

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The week ending November 7, 2025, presented a starkly contradictory picture for global investors. In the United States, markets celebrated a “relentless rally” 1 that pushed major indices to new record highs.2 Yet, this euphoria was built on a dangerously fragile foundation. It unfolded against the backdrop of a historic, 36-day U.S. government shutdown that has blinded policymakers and investors by delaying critical economic data.4

This “data void” created an environment of extreme instability. The market’s optimistic mood, fueled by strong earnings from a handful of tech giants, was abruptly shattered mid-week. In the absence of official statistics, a terrifying private-sector report showing the highest number of layoffs since the 2008 financial crisis 5 sent a shockwave of fear through the global financial system, wiping out the week’s earlier gains.6

The Big Picture: Central Banks Diverge as U.S. Shutdown Scrambles Signals

The week’s volatility was amplified by a profound sense of uncertainty from the world’s central banks.

In the U.S., Federal Reserve Chair Jay Powell tempered market expectations for a December interest rate cut. This “hawkish” talk caused the probability of a cut, as measured by Fed funds futures, to drop from a near-certain 90% to around 68% 7, and later 66%.8 This initially supported a rally in the U.S. dollar.7

However, this policy-driven strength was short-lived. The dollar’s buying momentum faded, and the currency ended the week weaker after alarming private-sector jobs data 9 and a sell-off in stocks 8 rattled investors. This reversal suggests markets are calling the Fed’s bluff; investors appear to be betting that the “real” economy is slowing so fast that the Fed will be forced to cut rates, regardless of what policymakers say.

This sense of paralysis was a global theme.

  • The Bank of England (BoE) voted to hold its key rate at 4%, but the decision was razor-thin, passing on a 5-4 split.10 The committee is visibly deadlocked, torn between fears of persistent inflation and the risks of a slowing economy.
  • The Reserve Bank of Australia (RBA) also held its cash rate steady at 3.60%.11
  • The European Central Bank (ECB) and Bank of Japan (BoJ) likewise maintained their policy, holding rates steady.12

This “Great Pause” by the world’s major financial institutions is not a sign of confidence. Instead, it signals a period of deep uncertainty. The Fed is “data-blind” due to the shutdown 14, the BoE is “committee-blind” due to its internal split, and the other banks appear “growth-blind,” stuck in a “wait-and-see” mode.

United States: A Tech-Led High Followed by a Layoff-Driven Low

The epicentre of the week’s chaos was the U.S. market, which experienced a dramatic mood swing from record-setting euphoria to economic fear.

The Shutdown’s Shadow: Flying Blind in a Data Void

The U.S. government shutdown, which began on October 1, has now dragged on for 36 days, the longest in history.4 This political stalemate has created a “fog of war” for markets by suspending the release of crucial economic statistics.15

Most importantly, the closely-watched monthly Non-Farm Payrolls (NFP) report, which provides the official unemployment and jobs-created numbers, was delayed.4 This has left the Federal Reserve in the impossible position of making critical monetary policy decisions without its most important data.14

This data vacuum makes markets unstable. With no reliable government data, investors are forced to overreact to less-reliable, second-tier private reports. This is precisely what happened on Thursday.

Alarm Bells from Private Data: The Challenger Report

With no NFP to trade on, all eyes turned to private data. On Thursday, a report from the outplacement firm Challenger, Gray & Christmas acted as a fire alarm in a crowded theatre. The report showed that U.S. employers announced 153,074 job cuts in October.5

This number was devastating. It was the highest monthly total for layoffs since 2008 and the worst October for job cuts in 20 years.5

This report, which was blamed for a “gloomy mood on Wall Street” and a sharp stock market sell-off 5, compounded earlier bad news. A separate private report from ADP had already shown an unexpected loss of 32,000 private-sector jobs in September.15

The data revealed a frightening “two-track” economy. On one hand, mega-cap tech companies were reporting robust earnings; on the other, the rest of the economy appeared to be shedding jobs at a rate not seen since the great financial crisis.

The “Magnificent” Rally Hits a Wall

The week didn’t start with fear. It began with a “relentless rally” 1 driven by “solid corporate earnings from some big tech firms”.2 Both the S&P 500 and the tech-heavy Nasdaq Composite reached new record highs.2 This optimism was boosted by strong market reactions to earnings from giants like Apple 1 and Alphabet.12

However, this rally was dangerously “narrow”.12 The market’s strength was not broad. In fact, the S&P 500 advanced one day even as seven of its 11 sectors lost ground.12 A clear sign of this weakness was the 2.68% gap between the standard S&P 500 (weighted by market cap) and its “equal-weighted” version.12 In simple terms, this means that while a few “generals” like Apple and Microsoft were charging forward, the vast “army” of the other 490+ stocks was quietly retreating.

This fragile, top-heavy market was vulnerable to a shock, and the Challenger jobs report provided it. The tech-led rally hit a wall and reversed violently. By Friday, the Nasdaq Composite had dropped 1.9% 6, and the S&P 500 fell 1.1%.6 This locked in the Nasdaq’s steepest weekly drop since April.17

Table: U.S. Major Index Performance (Week Ending November 7, 2025)

This table clearly illustrates the “two-track” market. The large-cap tech stocks in the Nasdaq posted a weekly gain, while the small-cap “Main Street” stocks in the Russell 2000 fell significantly.

IndexWeekly Close ValueWeekly Change (%)Year-to-Date (YTD) Change (%)
DJIA47,562.87+0.75%+11.80%
S&P 5006,840.20+0.71%+16.30%
NASDAQ23,724.96+2.24%+22.86%
Russell 20002,479.38-1.34%+11.17%

Source: Data compiled from Broadridge Advisor Solutions 2

Europe: Markets on Edge After a Split Decision in London

European markets were mixed and on edge, ending the week mostly lower. The pan-European STOXX Europe 600 Index finished down 0.67%.12

National markets diverged. Germany’s DAX fell 1.16% and France’s CAC 40 dropped 1.27%.12 In contrast, the UK’s FTSE 100 index managed a 0.74% gain.12

The main event was the Bank of England’s interest rate decision. The committee voted 5-4 to keep rates on hold at 4%.10 This extremely close vote signals that the central bank is paralysed by disagreement. Four of the nine members wanted to maintain a more restrictive policy, citing “risks of persistence in inflation”.10 This split decision offers no clear guidance for the future, leaving borrowers and businesses in limbo.10

The FTSE 100’s gain was not a sign of domestic strength but rather a statistical quirk. The index was “helped partly by the depreciation of the British pound”.12 Many companies on the FTSE 100 are large multinationals that earn money in U.S. dollars and Euros.18 When the pound gets weaker, those foreign earnings are worth more when converted back to pounds, which artificially pushes the index higher.

In the Eurozone, the European Central Bank also kept rates on hold, as expected.12 There were some modest signs of life in the economy, as German exports rose 1.4% in September, beating forecasts, helped by a 12% jump in exports to the U.S..8

Asia: A Mid-Week Rebound Wiped Out by U.S. Tech and Weak China Data

Asian markets experienced a “whiplash” week, demonstrating their high sensitivity to American tech sentiment.

On Thursday, markets across the region rallied strongly, “tracking overnight gains on Wall Street”.20 Japan’s Nikkei 225 jumped 1.5% 20 and Hong Kong’s Hang Seng climbed 1.6% 21, with tech and chip-related stocks leading the way.22

This optimism was completely erased on Friday. Following the U.S. tech sell-off, Asian markets “fell sharply”.6

  • Japan’s Nikkei 225 dropped 1.6%.6
  • South Korea’s Kospi tumbled 2.2%.6
  • Hong Kong’s Hang Seng slid 0.9%.6

The sell-off showed that Asian markets, especially the tech-heavy exchanges in Korea and Japan, are not trading on their own fundamentals. They are acting as a leveraged bet on the U.S. Nasdaq.

Adding to the gloom was new data from China. The country’s October trade balance came in weaker than expected, with exports unexpectedly falling 1.1%.6 This is a worrying sign, as it suggests that global demand for Chinese goods is weak, even after a recent “U.S.-China trade truce”.13

India: Profit-Booking Halts the October Rally on Dalal Street

Indian markets ended a volatile week in the red, snapping a powerful October rally. After surging 4.51% last month 25, the benchmark Sensex and Nifty 50 indices fell for a second consecutive week 26, closing down approximately 0.9%.17

This decline is being seen as “profit booking” 17 in response to a “tug-of-war” between strong domestic fundamentals and weak global sentiment.

On the positive side, India’s domestic story remains strong. The Reserve Bank of India (RBI) has provided a favourable outlook with forecasts of lower inflation and higher GDP growth.26 Second-quarter earnings have been stable, with Public Sector (PSU) banks performing particularly well, rising over 2% for the week.17

However, these domestic strengths were overshadowed by global headwinds. The pullback was triggered by “weak global cues” 17, “foreign fund outflows” 17, and the sharp, tech-led drop in the U.S. Nasdaq.17

This fear of foreign outflows was crystallised by a single corporate event: Bharti Airtel’s stock tumbled 4.46% 27 after a major stakeholder, SingTel, sold a 0.8% stake for $1.2 billion.17 This high-profile sale turned a general fear of foreign money leaving into a hard, tangible fact, spooking other investors.

Oceania: RBA Caution and Commodity Woes Drag Down the ASX

Australia’s S&P/ASX 200 index fell for a second straight week, losing 1.3%.28 The index, which closed at 8,881 on October 31 29, finished the week at 8,769.66.30

The market was hit by a “perfect storm” of its three main sensitivities: domestic monetary policy, the financial sector, and commodity prices.

On Tuesday, the Reserve Bank of Australia (RBA) left its cash rate unchanged at 3.60%.11 While the “hold” was expected, the bank’s accompanying statement was “cautious”.31 The RBA noted that inflation “has increased and is back above our 2-3 per cent target range,” where it is expected to stay “for a while”.32 This statement signals the RBA is stuck in a stagflationary bind: it cannot cut rates for fear of inflation, but it cannot hike rates without damaging a slowing economy.

This economic fragility was highlighted by a sharp 5.7% slump in top investment bank Macquarie, which missed profit expectations and dragged the wider financial sector down.28

Finally, the commodity pillar of the Australian market also weakened. The price of iron ore, a critical Australian export, fell to $103.34 USD/T 33, reflecting ongoing concerns about weakening industrial demand from its largest customer, China.34

Conclusion

The week ending November 7, 2025, served as a painful reality check for global markets. The “record high” set in the U.S. was exposed as a narrow, fragile rally built on the performance of just a few tech giants. This “AI-euphoria” was no match for the economic fears triggered by the U.S. government’s data blackout and the alarming private-sector layoff report.

The panic in U.S. tech quickly spread globally, pulling down markets in Asia and halting the rally in India, proving that global markets remain tightly coupled to the Nasdaq. Meanwhile, central banks in the U.S., UK, and Australia appear paralysed by uncertainty, trapped between fighting inflation and supporting growth.

Investors are now caught between a “new economy” of tech stocks that looks overvalued and an “old economy” of jobs and manufacturing that appears to be slowing down at an alarming pace. With policymakers flying blind, the path forward for markets is exceptionally unclear.

Disclaimer

This article is for informational purposes only.35 Nothing contained in this article constitutes investment, legal, tax, or insurance advice, or the recommendation of or an offer to sell, or the solicitation of an offer to buy or invest in any investment product.36

This material should not be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction.37 We are not soliciting any specific action based on this material. It does not take into account the particular investment objectives, financial conditions, or needs of individual clients.37 You should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalised investment advice.38

All investments involve varying degrees of risk, including the risk of loss.36 The price and value of the investments referred to in this material and the income from them may go down as well as up, and investors may realise losses on any investments or get back less than they invested.35

Please remember that past performance may not be indicative of future results.38 Past performance is not a guide to future performance 37 and is not a reliable indicator of future results.35 Future returns are not guaranteed, and a loss of original capital may occur.37

Information contained in this material has been obtained from sources believed to be reliable, but we do not represent that it is accurate, complete, and/or up to date, and it should not be relied on as such.36 Due to various factors, including changing market conditions, the content may no longer be reflective of current opinions or positions.38

To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.35

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