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Fears that a potential credit event could roil markets and the economy were quelled today following earnings results from regional banks, which strengthened confidence that loan quality issues were isolated events and not a widespread industry problem. Additionally, the Trump put worked to stabilize angst on Wall Street, as the commander in chief delivered a conciliatory message regarding Washington’s trade conflict with Beijing, calling his 100% tariff threats unsustainable. Stocks were plummeting in the early morning hours after midnight, with futures reaching their daily bottom around 4:00 am ET before rebounding ferociously. Equities are now advancing modestly, even though investors are still worried about the financial health of other lenders and to a lesser extent, cross-border commerce tensions. The U-turn was also evident in the Treasury complex and the greenback, with yields and the domestic dollar plunging and then rising significantly. Volatility protection instruments reflect a calmer landscape, although a VIX of 25 alongside fresh records for gold and silver signals continued apprehension amongst participants. Energy commodities are climbing from very low levels and lumber is appreciating but copper is lower. Bitcoin reached bear market territory as the cryptocurrency malaise has persisted; forecast contracts are catching bids, however.

Wall Street is on Contagion Watch

When several lenders experience problems with credit quality on their books, Wall Street immediately assesses if the issues are isolated to only a few institutions or are more widespread, signaling broader trouble. A coincidence that could benefit bulls or bears, depending on the outcome, is that the distress is occurring during earnings season. As firms report, investors and economists alike will carefully analyze the top and bottom lines, balance sheet health, cash flow trends and company outlooks for evidence that supports further upside in equities and growth, or clues that point to a greater likelihood of near-term profit-taking and an economic slowdown. And with the government shutdown now on its 17th day amidst no light at the end of the tunnel, critical data with the potential to influence market moves remains unavailable. 

International Roundup

Singapore’s Trade Surplus Grew Last Month

Strong demand for electronics in September helped boost Singapore’s trade surplus from $4.99 billion in August to $5.94 billion, according to Enterprise Singapore. During the ninth month of 2025, Singapore’s non-oil exports jumped 13% month over month (m/m) and 6.9% year over year (y/y), a reversal from the 9.1% and 11.5% declines in August. Shipments of integrated circuits, personal computers and disk media products led the y/y success with gains of 34.9%, 58.3% and 42.9%. Non-electronics, however, disappointed, ascending only 0.4% y/y.  Electronics also contributed to the island-nation’s re-exports surging 21.2% y/y, a considerable acceleration from the 12% pace in August. Meanwhile, imports climbed, but the growth only partially offset the impact of strong shipments abroad on Singapore’s trade surplus.

Regarding overall non-oil exports, shipments to Hong Kong, Taiwan and China jumped 56.3%, 31.9% and 10.1% y/y, respectively. Conversely, demand from the European Union, the US and Indonesia sagged, although the world’s largest economy increased its imports of re-exports.

Currency Weakness Drives Import Prices Higher in South Korea

South Korea’s currency depreciation relative to the US dollar and higher crude oil costs caused import prices to climb 0.2% m/m and 0.6% y/y in September, the third-consecutive m/m increase. In August, import prices were up 0.3% m/m but sank 2.2% relative to the year-ago period. For the recent print, while oil was more expensive, the raw materials category was down 0.1% m/m, but intermediate goods and consumer goods were up 0.5% and 0.1. Export prices, furthermore, climbed 0.6% m/m and 2.2% y/y.

While Unemployment Rate Falls

South Korea’s unemployment rate fell from 2.6% in August to 2.5%, according to the Ministry of Data and Statistics. In September, payrolls expanded by 310k, the largest gain in more than one and a half years. 

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