Global Markets Weekly Update - Summary
U.S. Market Overview
Major U.S. equity indexes finished the week lower, influenced by elevated Treasury yields, renewed U.S.-Iran tensions, and higher oil prices. The S&P MidCap 400 Index led declines, dropping 2.46%, while the Nasdaq Composite and Russell 2000 Index fell 2.05% and 1.65%, respectively. The Dow Jones Industrial Average fared better, declining only 0.85%.
Treasury Yields and Fed Minutes
Long-term U.S. Treasury yields rose, with the 30-year bond yield reaching its highest level since 2007. The Fed's July meeting minutes indicated uncertainty over the inflation outlook, with expectations for inflation to moderate but risks skewed to the upside.
Business Activity and Employment
U.S. business activity accelerated in August, with the S&P Global Flash Composite PMI rising to 56.0. Employment increased at its fastest pace since January 2025, although price pressures remained elevated due to higher energy costs.
Housing Market Trends
The housing market showed ongoing weakness, with pending home sales dropping 2.3% in July and housing starts declining over 12%. The average mortgage rate was reported at 6.65%.
European Market Insights
The pan-European STOXX Europe 600 Index fell 0.56%. Economic activity in the Eurozone improved slightly, with the flash composite PMI at 52.1. However, Germany's manufacturing sector showed signs of strength, while services activity contracted.
Japan's Economic Situation
Japan's stock markets declined sharply, with the Nikkei 225 Index down 3.93%. The yield on the 10-year Japanese government bond reached a 30-year high before retreating. GDP growth slowed unexpectedly, and inflation accelerated, prompting speculation of a near-term rate hike by the Bank of Japan.
China's Economic Performance
China's equities diverged, with Hong Kong shares outperforming mainland benchmarks. Economic activity data for July showed a broad slowdown, leading to concerns about faltering momentum. The property sector continued to struggle, prompting authorities to implement supportive measures.
Other Key Markets
In Indonesia, the central bank held interest rates steady as the rupiah strengthened. In Brazil, foreign outflows and a major retail bankruptcy weighed on markets, although there was some recovery later in the week.
Market Performance Table
| Index | Friday’s Close | Week’s Change | % Change YTD |
|---|---|---|---|
| DJIA | 53,277.01 | -455.40 | 10.85% |
| S&P 500 | 7,674.37 | -111.39 | 12.11% |
| Nasdaq Composite | 26,180.46 | -548.71 | 12.64% |
| S&P MidCap 400 | 3,830.41 | -96.57 | 15.89% |
| Russell 2000 | 3,017.87 | -50.55 | 21.59% |
Source: Reuters, Yahoo! Finance, Bloomberg. Closing data as of 4 p.m. ET.