On Friday, global financial markets began the fourth quarter with mixed results, with Wall Street recovering from recent losses but Asia and Europe making little headway.

A slew of concerns has recently haunted global stocks, including supply chain disruptions, inflation, the Delta variant of Covid-19 and its impact on economic recovery, and, most recently, political deadlock in the United States, which is moving the country closer to a potential financial default.

Wall Street gained ground on the first day of trading in October, in what analysts saw as a good reaction to the news that pharmaceutical giant Merck would seek approval in the United States for an oral medicine against Covid-19 that performed well in clinical testing.

“I think a lot of people, not just investors, have been hoping for a cure for Covid,” said Kim Forrest of Bokeh Capital Partners.

European markets experienced a bumpy day, with the FTSE 100 in London and the DAX in Frankfurt both closing the afternoon in the red, while the CAC 40 in Paris finished nearly stable. Earlier in the day, Asian markets suffered more significant losses.

“Markets are likely to continue volatile as (the fourth quarter) begins, with October another historically bumpy period following September’s wild ride for the markets, which saw the S&P 500 snap a seven-month winning run,” said Charles Schwab analysts.

There was reason to be concerned. The US Commerce Department’s personal consumption expenditures price index was up 4.3 percent from August 2020, as the world’s largest economy battles supply chain delays and shortages as it recovers from the pandemic’s business closures.

Lawmakers in Congress agreed on a bill to avert a government shutdown on Thursday evening, but they now have just weeks to raise the debt ceiling and avoid default or face economic disaster.

“The news coming out of Washington hasn’t been as encouraging,” Briefing.com analyst Patrick O’Hare said.

Investors in Europe were also concerned about rising inflation.

Consumer prices in the Eurozone rose by 3.4 percent year on year in September, the sharpest rate since 2008, as energy prices skyrocketed.

Most global central banks believe that the current inflation increase is only transitory, but investors are concerned that tighter monetary policy may stymie any post-Covid rebound.

According to Interactive Investor analyst Richard Hunter, the inflation report “probably hasn’t improved general attitude.”

“However, the European Central Bank is singing from the same hymn book as the other major central banks, anticipating that the elevated level of inflation is transitory.”

“Time will tell” whether the ECB needs to take “tightening action in due course,” he said.

Investors expect the Federal Reserve to begin trimming its mammoth bond-buying program before the end of the year.

Earlier this week, investors were alarmed by a spike in government bond yields in the United States and Europe.

On Thursday, the final session of the third quarter, all three major Wall Street indexes finished in the red. The Dow and Nasdaq fell for the quarter as a whole, while the S&P 500 gained somewhat.