The U.S. non-farm payroll report in September came in much weaker than expected, further dampening market expectations for the Federal Reserve to raise interest rates in the short term. On Friday, U.S. stocks rose while the dollar weakened, and U.S. Treasury yields tumbled sharply after the data release before quickly rebounding in a V-shaped pattern. Meanwhile, the Group of Seven (G7) announced the release of 100 million barrels of oil and petroleum product reserves, causing international oil prices to plummet during trading.

Data released by the U.S. Department of Labor on Friday showed that non-farm employment in September increased by only 29,000 people, far below the market's expectation of 90,000; the number of new jobs created in August was revised down from 162,000 to 133,000, and the unemployment rate rose to 4.2%. Following the release of the data, market expectations for a Federal Reserve interest rate hike in October further dropped to around 20% to 21%, lower than the approximately 26% before the data was released.

U.S. stocks and U.S. bonds then exhibited distinctly different trends. U.S. stocks, particularly technology stocks, were boosted by the reduction in "interest rate hike pressures," with the Nasdaq index rising by more than 1%, and NVIDIA hitting a record high during trading; however, U.S. bonds failed to continue their initial upward trend. The yield on the benchmark 10-year U.S. bond once rebounded by more than 10 basis points from the daily low set after the release of the non-farm employment report.

Media analysis suggests that bond investors initially bet that weak employment would reduce the pressure on the Federal Reserve to continue raising interest rates, but then they shifted their focus back to factors such as energy prices, inflation expectations, fiscal deficits, and yield spreads; commentators point out that the weak non-farm payroll data does not completely rule out the possibility of further rate hikes in the coming months.

This week, the main trend in global assets was not a single "risk appetite," but rather a clear divergence between AI tech stocks and traditional macro assets. The tech sector was the main sector that performed the best this week, while the financial and healthcare sectors performed at the bottom.

There has also been a divergence in the trends of long and short-term U.S. Treasury yields: the 10-year yield continued its weekly upward trend for a month, while the 2-year yield, which is more sensitive to interest rates, fell after six consecutive weeks of increases, indicating that market bets on the Federal Reserve's short-term policies have eased. However, concerns regarding long-term inflation, fiscal supply, and term premiums still exist. Crude oil prices have been fluctuating due to risks in Middle Eastern supply, the release of strategic oil reserves, and tight refined oil supplies; precious metals such as gold and silver failed to recover their losses at the beginning of the week and continued to be pressured by the strong dollar and high U.S. Treasury yields.

U.S. Stocks: Nasdaq rises over 1% to a new high during the session; delivery data boosts Tesla, while Toshiba's expansion news impacts memory chip stocks

The three major U.S. stock indexes opened higher on Friday and maintained an upward trend throughout the day. The Nasdaq index closed up 1.19% at 27,190.86 points, hitting a new closing high since September 22, with an earlier gain of 3% that also set a new intraday high; the S&P 500 index rose 0.73% to 7,722.72 points; the Dow Jones Industrial Average increased by 250.40 points, or 0.49%, to 51,176.96 points; the Nasdaq 100 index gained about 1%, setting new records both during the session and at the close. The Russell 2000 index also closed up 0.94%.

Throughout the week, the S&P 500 index fell by 0.27%, marking its third weekly decline in the past four weeks; the Dow Jones Industrial Average fell by 1.26%, its fourth weekly decline in the past five weeks; the Nasdaq Composite Index rose by 0.45%, for its third consecutive week of gains; the Nasdaq 100 index also rose by 0.65%, for its third consecutive week of increases; while the Russell 2000 Index fell by 0.16%, experiencing its fourth consecutive week of declines. The technology sector was the best-performing major sector this week, whereas the financial and healthcare sectors performed at the bottom. The KBW banking index fell by 2.78% for the entire week.

In terms of individual stocks, NVIDIA ( NVDA ) once rose by about 3% during trading, setting a new intraday high for the first time in over four months since mid-May, and ultimately closed up about 1.3%, approaching the highest closing price recorded in mid-May; Tesla ( TSLA ) was boosted by its third-quarter delivery figures, rising by more than 5% at one point during trading, and finally closed up about 4.7%. Tesla delivered 486,500 vehicles in the third quarter, a year-on-year decrease of 2.1%, but this was still about 5% higher than analysts' expectations.

Chip stocks generally rose on Friday, with the Philadelphia Semiconductor Index closing up about 2.4%, and the index has gained a total of 3.69% this week. However, memory chip stocks were sold off on that day.

Nikkei News reports that Toshiba plans to double the production capacity of traditional hard drives ( HDD ) used in its data centers by the fiscal year 2027. The market is concerned that the increased supply may weaken the current tight supply-demand situation. Seagate Technology ( STX ) and Western Digital ( WDC ) both fell by about 10.2% on Friday, SanDisk ( SNDK ) fell by about 3.8%, and Micron ( MU ) fell by more than 2%.

Regarding other individual stocks, Broadcom (AVGO) rose by about 3.4%, following reports that the company agreed to provide a loan of up to $42 billion to Anthropic; ON Semiconductor (ON) saw a rise due to an increased acquisition bid for Synaptics (SYNA) to $123 per share, with Synaptics soaring by about 14%; Nike (NKE) experienced a decline of over 3.6% in the early session due to weak sales in the Chinese market, downgraded earnings guidance, and announced layoffs.

U.S. Treasuries: 10-year yield hits a new daily low after non-farm payroll data, then rebounds by more than 10 basis points

After the release of non-farm data, there was a significant buying interest in U.S. Treasuries. The yield on 10-year U.S. Treasuries briefly fell below 5.16%, and the yield on 2-year Treasuries also dropped to around 4.70%. However, as trading continued, yields quickly rebounded, with the 10-year yield rising to around 5.30% during the session and ultimately closing at about 5.28%, an increase of about 4 basis points in a single day; the 2-year yield closed at around 4.82%, up by about 3 basis points.

MarketWatch pointed out that initially, the bond market believed that a cooling in employment would reduce the pressure for the Federal Reserve to continue raising interest rates, leading to purchases of U.S. Treasuries; however, as the market re-evaluated the situation, rising energy prices could push up inflationary pressures. At the same time, the U.S. fiscal deficit and the large supply of government bonds continued to exert pressure on long-term yields. In addition, against the backdrop of recent sell-offs in global bond markets, the term premium has also become a factor of concern for investors.

In other words, the weak non-farm payroll data reduced expectations for short-term interest rates, but it was not sufficient to completely reverse the long-term pressures on U.S. Treasury bonds due to supply, inflation, and term premiums.

Over the week, the yield on 10-year U.S. Treasury bonds rose by about 12 basis points, marking the fifth consecutive week of increases and the longest such streak since November 2024; meanwhile, the yield on 2-year bonds fell by about 3 basis points, ending a six-week consecutive upward trend. This divergence between short- and long-term yields reflects a relaxation in market bets regarding the Federal Reserve's policy path in the short term, but concerns regarding long-term inflation, fiscal supply, and term premiums still exist.

European debt: The 10-year yield spread between France and Germany widens to its largest level since 2011

European bond markets continue to experience severe volatility.

On Friday, the yield spread between 10-year government bonds of Germany and France widened to its widest level since 2011; the yield on French 2-year government bonds briefly rose to 3.84%, while the yield on German 2-year bonds fluctuated between 2.94% and 3.06%. Over the past week, the yield on German 2-year bonds decreased by nearly 25 basis points, whereas the yield on French 2-year bonds increased by nearly 14 basis points.

The market is more concerned about France's fiscal situation. Previously, the yield on French 10-year government bonds approached 4.95%, reaching a level not seen in about 20 years, and the yield spread between French and German 10-year government bonds exceeded 140 basis points, reaching the widest level since the European debt crisis in 2012.

Throughout the week, the yield on German 2-year government bonds fell by nearly 25 basis points, while the yield on French 2-year bonds rose by about 14 basis points.

As the global bond market is under the pressure of high oil prices, inflation, and fiscal deficits, France is becoming one of the markets with the highest risks in the European bond market. France's fiscal situation and political uncertainties continue to be important pricing factors in the European bond market.

Forex Market: After Non-Farm Payrolls, the US Dollar Index Accelerated Its Decline from a 1.5-Year High; Offshore RMB Nearly Reached 6.70

The US dollar weakened significantly after the non-farm payroll data was released. The US Dollar Index (DXY) briefly rose before the release of the US non-farm employment report, but the decline accelerated afterward. US stocks hit a new intraday low of 101.67 at midday, falling by more than 0.4% from the high of 102.20 set on Thursday, which was the highest level since April 2025. After four consecutive days of gains, the index fell on the first day of this week, but it continued to rise overall, marking three consecutive weeks of increases.

The Japanese yen, which had experienced two consecutive declines, rebounded. After the U.S. employment report, the dollar against the yen quickly widened its decline and fell below 157.00, hitting a new daily low, approaching the lowest level since September 18th when it dropped to 156.37 on Wednesday, with a intraday loss of over 0.7%. The euro against the dollar also saw a rapid rise after the U.S. employment report, with U.S. stocks hitting a new daily high of 1.1286 in the early session, moving away from the lowest level since May 2025 set on Thursday.

The offshore RMB ( CNH ) against the US dollar hit a new daily low of 6.7175 in the early Asian trading session, but soon turned higher and maintained its upward trend. After the release of the US non-farm payroll report, the increase accelerated, with US stocks approaching the 6.70 level at 6.7008 in the early session, reaching a high since September 23. Following two consecutive declines, the RMB rebounded, showing a cumulative gain this week after a pullback last week.

Bitcoin ( BTC ) broke through $87,100 during the European session, reaching a new high since September 23. After the opening of U.S. markets, it continued to lose some of its gains and turned lower midday, falling below $83,900 at one point to set a new daily low, a decrease of over $3,000 or nearly 4%. By the close of U.S. markets, it was trading below $84,400, with a loss of about 0.5% in the past 24 hours and a gain of about 0.5% in the past week.

Crude Oil: G7 to Release 100 Million Barrels of Reserves, Oil Prices Plunge During Trading Hours

International oil prices were hit hard on Friday by news of the release of strategic reserves by G7. G7 announced that it would coordinate the release of 100 million barrels of oil and petroleum product reserves through the International Energy Agency (IEA), with the plan to last for four months, including a large amount of diesel reserves.

After the announcement of the news, US WTI crude oil prices once fell to around $88.06 per barrel, a decrease of over 5%; Brent crude oil prices also fell to around $98.40 per barrel, with a decline of nearly 4%. By the close of trading, the November contract of WTI fell by 1.90% to $91.11 per barrel; the December contract of Brent crude oil fell by about 0.06% to $102.25 per barrel.

Based on the closing prices of monthly contracts, US crude oil has fallen by approximately 1.41% this week, marking the second consecutive week of decline; in contrast, Brent crude oil has risen by about 4.94%, also for the second consecutive week.

The media points out that the main pressures on the current energy market are no longer just crude oil supply, but also refining capacity and the supply of refined products. The decline in refining capacity in the Middle East and Russia has made the supply of refined products such as diesel a new key pressure point for the market, which is also one of the reasons why G7 is focusing on releasing refined product reserves this time.

Gold: Rose briefly after the non-farm payroll data, but both gold and silver continued to plummet throughout the week.

Gold also experienced a clear reversal during the session. After the release of the non-farm payroll data, gold futures rose to around $4,259, with a gain of over 1%, and spot gold briefly broke through $4,220; however, as U.S. Treasury yields rebounded, gold prices gave back some of their gains, and U.S. stocks turned lower in the early session.

By the close of trading on Friday, the October gold futures contract COMEX fell 0.94% to $4,133.7 per ounce. After three consecutive gains, it retreated to a low not seen since August 4th, recording a weekly decline of 3.59% this week, which is the largest single-week drop since June 5th, and marking two consecutive weeks of declines.

On Thursday, after the U.S. non-farm payroll report, both New York silver and gold futures, which had seen three consecutive declines, saw their gains widen. However, U.S. stocks turned lower in the early session. The nearest-month contract, COMEX, October silver futures closed down 1.23% at $59.977 per ounce, hitting a new low since August 3rd, and recorded the largest weekly decline since June 26th, with a cumulative loss of 6.68% this week.

In this period, both gold and silver futures have seen consecutive declines for two weeks, marking the fifth consecutive week of decline in the past six weeks.

New York copper rebounded slightly after a decline on Thursday. COMEX October copper closed up 0.15% at $6.492 per pound, breaking away from the low close on September 16 that was set on Thursday. This week, it has seen a cumulative decline of 3.1%, marking the largest weekly drop since June 26, following two consecutive weeks of gains.