Manufacturing data and shutdown-delayed labor signals set the tone for markets today

Global markets today are focused on fresh U.S. economic data and the lingering effects of the recent government shutdown, which together are shaping expectations for growth and central bank policy. The key driver is the release of the ISM Manufacturing PMI, one of the first major reads on how the manufacturing sector is holding up after the shutdown. Investors worldwide watch this closely because U.S. manufacturing trends often signal the broader health of global trade and industrial demand. A stronger-than-expected reading would suggest that factory activity is proving resilient, which could support risk appetite in equities and cyclical sectors globally. Conversely, a weak print would reinforce concerns that growth is slowing, pressuring stocks tied to global demand and potentially boosting safe-haven assets. At the same time, there is elevated uncertainty around the true state of the U.S. labor market. The government shutdown has delayed official labor data, leaving investors to rely on private-sector employment indicators, which have recently shown signs of weakness. This data gap makes it harder for markets to judge whether the economy is merely cooling or slipping more sharply, and that uncertainty is encouraging a more cautious stance in global equities. Because the U.S. consumer is a major engine of global growth, any perceived softening in U.S. jobs can quickly ripple through sentiment in international markets. These growth concerns are feeding into expectations that the Federal Reserve may turn more dovish than markets had previously anticipated. If incoming data confirm softer manufacturing and labor conditions, investors may increasingly price in a slower path of rate hikes or even potential cuts, which can be supportive for stocks in the medium term but also signal a weaker economic backdrop. The combination of near-term data risk, policy uncertainty, and the delayed visibility on key indicators is likely to keep volatility elevated today, with traders reacting quickly to the ISM release and any commentary that sheds light on the underlying strength of the U.S. and, by extension, the global economy.