Markets Today: SNB Leave Rates Unchanged, FTSE Stead. Fed Speakers and US GDP Data Ahead

[Ben Graham]

Asia Market Wrap - Asian Stock Rally Takes a Breath

Most Read: Gold's (XAU/USD) Bull Run Just Getting Started? A Look at What History Says

Asian stock markets took a pause on Thursday after their recent surge, as investors waited for new reasons to buy. Meanwhile, the Japanese yen faced significant selling pressure, especially against the euro and Swiss franc.

The broadest index of Asia-Pacific shares (excluding Japan) slipped by 0.1%, coming after a very strong period of rallying over 5% this month and 9% this quarter. Japan's Nikkei index was up slightly by 0.2%, having jumped 7% this month and 13% this quarter.

Chinese stocks were the best performers: the CSI300 index rose by 0.7%, and Hong Kong's Hang Seng advanced by 0.2%. Chinese technology stocks are particularly strong, marking their eighth consecutive week of gains, the longest winning streak on record driven by excitement over Artificial Intelligence (AI).

Traders have been heavily buying shares of companies like Nvidia and Alibaba as these firms invest billions into AI, a theme that has fueled a major stock market rise in both the U.S. and China this year. That rally now faces a test with the release of the US Personal Consumption Expenditures (PCE) report on Friday, as traders will look for clues from this key inflation data to predict the future direction of US interest rates.

SNB Leaves Rate Unchanged

The Swiss National Bank (SNB) decided to keep its main interest rate unchanged at 0%. It also maintained the small 0.25% discount on large bank deposits and confirmed that it is ready to step into the foreign currency markets if necessary.

Inflation in Switzerland remains very low, only slightly increasing to 0.2% in August (up from -0.1% in May), mainly due to higher prices for tourism and imported goods. The SNB expects inflation to stay low for the next few years: 0.2% in 2025, 0.5% in 2026, and 0.7% in 2027, assuming the interest rate stays at 0%.

Global economic growth slowed down early in 2025 due to U.S. trade tariffs and general uncertainty, and the SNB anticipates slow growth ahead. In Switzerland, economic growth softened to 0.5% in the second quarter, following a strong first quarter that was boosted by pharmaceutical exports. The impact of higher US tariffs is expected to hurt Swiss exports and business investment, particularly for machinery and watchmakers, although the service sector is expected to remain strong. The SNB forecasts the overall economy to grow by 1–1.5% in 2025, slowing down to just under 1% in 2026, and expects the unemployment rate to rise further.

European Session

European stock markets fell slightly on Thursday. Early losses were driven mainly by healthcare and industrial company shares. Investors are now focusing on speeches from several U.S. Federal Reserve officials and upcoming economic data, hoping to get a clearer idea of the Fed's future interest rate plans.

The main pan-European stock index, the STOXX 600, dropped by 0.5%. Most national stock markets also started lower, with Germany's main index and the UK's FTSE 100 both down 0.4%.

Healthcare stocks were down 1.1%. The decline was led by German medical technology company Siemens Healthineers, whose shares slid 6%. This followed an announcement by the U.S. Commerce Department that it is opening new national security investigations into the import of various products, including medical items and industrial machinery. The UK's Smith+Nephew also saw its shares fall by 1.1%.

Other sectors lagging the market included construction materials and industrial goods and services.

However, there was a bright spot: Swedish fashion retailer H&M saw its stock jump 9.4% after reporting a third-quarter profit that was significantly higher than analysts had expected.

On the FX front, the Chinese yuan strengthened against the US dollar on Thursday. This was due to two main factors: traders were betting the US dollar would continue to weaken following the Federal Reserve's decision to resume cutting interest rates, and the Chinese stock market was performing well.

By early morning, the yuan was up 0.11% against the dollar. Before the market opened, China's central bank, the People's Bank of China, set a daily reference rate for the yuan that was stronger than analysts had predicted.

Meanwhile, the US dollar was stable in Asian trading after increasing overnight, with the dollar index near a three-week high.

The dollar index is now close to achieving a gain for the entire month.

The euro and the British pound remained mostly unchanged after both had dropped by 0.6% against the dollar on Wednesday.

Currency Power Balance

Source: OANDA Labs

Oil prices dropped slightly on Thursday, pulling back from the seven-week high they hit in the previous session. This happened as some investors sold their holdings to take profits after US stocks closed lower. The anticipation of a slowdown in demand during the winter months, along with the expected return of oil supplies from Iraq's Kurdish region, also contributed to the price decline.

Specifically, Brent crude futures fell by 49 cents, or 0.7%, to $68.82 a barrel, and US West Texas Intermediate futures dropped by 54 cents, or 0.8%, to $64.45 a barrel.

Gold prices held steady on Thursday before a rally after the European open. A slightly weaker US dollar provided a bit of support for the price of gold. Investors are now looking forward to the release of important US economic data, hoping it will offer more clues about the Federal Reserve's future interest rate plans.

The price of spot gold rose to $3,760.22 per ounce. Gold, which is considered a safe investment and usually performs well when interest rates are low, reached a record high of $3,790.82 on Tuesday.

Economic Calendar and Final Thoughts

Looking at the economic calendar, the European session will be a quiet one with attention turning to the US session.

Around seven Federal Reserve officials are scheduled to speak later in the day and share more insights on monetary policy. From a data perspective, the US session brings a reading of US Q2 GDP data and weekly jobless claims numbers ahead of tomorrow's PCE release.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Chart of the Day - FTSE Index

From a technical standpoint, the FTSE 100 index rallied yesterday away from support before a pullback early this morning.

Price is now back at support and the confluence area between 9241 and 9223.

The last four-hour candle close left a significant downside wicjk which shows that bullish interest still remains in play.

For further downside to occur here, the FTSE would need a four-hour candle close below the 200-day MA 9223 which could open up a run toward the 9180 support and potentially lower.

On the upside, the 9260 handle will be the first area of interest before the 9280 and 9320 handles come into focus.

FTSE 100 Four-Hour Chart, September 25. 2025

Source: TradingView.com (click to enlarge)

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