Global Equities Face Tech Sell-Off; ISM Services PMI Up Ahead

The EUR/USD pair continued its downward trajectory on Tuesday as the Euro weakened against renewed US Dollar demand, marking its fifth consecutive day of losses.

The Euro’s decline has largely reflected broad USD strength rather than domestic eurozone developments, with limited economic releases leaving the single currency vulnerable to global market trends.

Investor sentiment toward the US Dollar has been supported by comments from Federal Reserve Chair Jerome Powell, who last week described further rate cuts as “not a foregone conclusion” following the recent 25-basis-point reduction.

Looking ahead, market participants are turning their attention to key US economic indicators, including the ADP Employment Change and the ISM Services Purchasing Managers Index (PMI), both due Wednesday. With the ongoing US government shutdown delaying official data releases, these private-sector indicators are increasingly relied upon for insights into hiring trends and broader service-sector activity.

In the Eurozone, traders will monitor the HCOB Services PMI and September Producer Price Index (PPI) for further cues on the economic backdrop. These releases will help determine whether the single currency’s recent weakness is likely to persist or if eurozone fundamentals may offer some support.

Gold prices dropped more than 1% on Tuesday as the US Dollar reached three-month highs, prompting investors to await key US economic data for clues on the Federal Reserve’s next policy moves.

Although the Federal Reserve cut interest rates last week, Chair Jerome Powell indicated the move could be the last for the year. Market expectations for a December rate cut have dropped sharply, with the CME Group’s FedWatch Tool showing a 71% probability for a cut on December 9-10, compared with over 90% a week earlier.

Gold, which does not yield interest, typically thrives in low-rate environments and amid economic uncertainty. The ongoing US government shutdown, now poised to become the longest ever, has stalled official data releases, pushing investors to rely on private reports such as the ADP National Employment Report, scheduled for Wednesday.

Despite the recent pullback, gold has surged 53% so far this year, though it has fallen more than 9% from its record high reached on October 20.

Oil prices slipped on Tuesday, pressured by persistent concerns over a looming supply glut and data showing an unexpected surge in U.S. crude inventories, sparking fears of weaker demand.

Earlier this week, prices had jumped after OPEC+ announced it would pause its planned production increases starting in the first quarter of 2026. However, market concerns over an oversupplied market remain, compounded by broader economic uncertainties in the U.S. and a fragile trade truce with China.

Data from the American Petroleum Institute (API) showed U.S. crude inventories increased by 6.5 million barrels in the week ending November 1, far above analysts’ expectations for a 2.4 million barrel draw.

The reading typically foreshadows the official Energy Information Administration (EIA) inventory report, due later on Wednesday. The sharp build in stockpiles has fueled concerns over sluggish U.S. fuel demand, especially as the ongoing government shutdown disrupts air travel across the country. The Senate remains deadlocked on further funding, showing little sign of resolution this week.

Global oil demand has also cooled steadily, partly due to sluggish growth in China, the world’s top oil importer, which is navigating tensions with the United States.

Combined with a strong U.S. dollar and uncertainty over the Fed’s December rate decisions, oil prices remained under pressure, offsetting any optimism from OPEC+’s production pause.

U.S. stocks closed sharply lower on Tuesday as warnings from major bank CEOs raised concerns over stretched valuations and a potential market correction. The US 500 and US Tech 100 suffered their largest one-day percentage drops since October 10, with technology shares bearing the brunt of the decline.

The sell-off was triggered after executives at Morgan Stanley and Goldman Sachs cautioned that equity markets could be heading toward a drawdown, as the US 500 had climbed to a series of all-time highs, largely fueled by the ongoing artificial intelligence boom. Six of the “Magnificent Seven” AI-related momentum stocks lost ground, while the Philadelphia Semiconductor Index fell 4.0%.

The ongoing U.S. government shutdown, which is approaching a record length, has further complicated the market outlook by delaying key official economic data. This has prompted investors to pay closer attention to private-sector indicators such as the ADP National Employment Report, due Wednesday. Federal Reserve officials’ remarks are also being carefully analyzed for insights into the central bank’s likely monetary policy path in the absence of timely government data.

Notable individual movers included Palantir Technologies, which slid 8.0% despite a better-than-expected fourth-quarter revenue forecast, continuing to reflect profit-taking after its 152% surge year-to-date while Uber declined 5.1% following a quarterly profit miss.