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Ahead of earnings season, the US stock market rally faces compounding threats from a government shutdown, eye-watering equity valuations, and a cooling labor market. With the S&P 500 at dot-com levels, experts warn of a potential 5-10% pullback, advising investors to trim highly valued positions.

Advanced economies face escalating political dysfunction and debt crises this week. The US shutdown, France s fiscal talks, Japan s new debt leadership, and the UK s budget ordeal highlight global financial strain. EU finance ministers will also discuss funding, underscoring how political discord challenges major economies amid $99 trillion in public debt.

Asian stocks, led by Japan, surged to a record high, with gold also hitting an all-time peak, as investors anticipate looser monetary policy and robust AI investment. Japan s Nikkei jumped after pro-stimulus Sanae Takaichi became Prime Minister, while the yen weakened significantly. The US tech rally is set to resume, despite a government shutdown.

ECL is a forward-looking accounting standard that requires banks to make provisions on expected losses based on past asset quality, instead of incurred loss-based provisioning. The already created buffer would come into play from the first quarter of FY28. "Banks with higher floating and contingent provisions would be less impacted by the ECL provisioning norm. Typically, a few large private banks have built material floating provisions as compared to their public sector peers," Icra senior vice president and co-group head Anil Gupta told ET.

According to Reserve Bank of India (RBI) data, system credit growth edged up to 10.3% year-on-year as of September 5, compared with 10% as of August 22, while deposit growth moderated to 9.8% from 10.2% over the same period. The system credit-deposit ratio remained elevated at 79% as of September 2025.

Biotique, the beauty and personal care brand, plans a $300 million public listing next year by diluting 10% equity. Valued at $3 billion, founder Vinita Jain stated the IPO aims for company longevity, deploying capital into R&D, distribution, and international expansion.

Overseas investors have significantly increased bearish bets on Nifty futures, reaching record levels due to US tariff offensives, a weak rupee, and expensive valuations. Their long-short ratio is near all-time lows, reflecting sustained selling pressure. While a technical pullback is anticipated, foreign investors are closely watching Q2 earnings for potential unwinding of these short positions.

Indian subsidiaries of multinational corporations frequently command significantly higher valuations than their parent companies, driven by investor confidence in India s rapid economic growth. LG Electronics India s IPO exemplifies this trend, with its valuation far exceeding its Korean parent despite smaller revenues. This pattern is observed across numerous sectors.

The National Stock Exchange has reduced the market lot sizes for derivative contracts across four key indices, including Nifty and Nifty Bank, effective from year-end. This move aims to make trading cheaper for participants by lowering contract values and margin requirements, aligning with Sebi guidelines. Experts believe it will support declining options volumes.