Global markets experienced a week of swings and conflicting sentiment, as investors navigated central bank signals, geopolitical tension, and soft economic data. From Asia to Wall Street, the tone shifted daily, ending Friday with uncertainty still clouding near-term outlooks.
Asian markets opened the week with modest optimism, buoyed by stabilising inflation figures in China and hopes of further stimulus from Beijing. The Shanghai Composite rose nearly 2% across the week, while the Hang Seng in Hong Kong posted its third straight weekly gain, lifted by tech stocks and a rebound in real estate. Japan’s Nikkei 225, however, lagged behind as the yen strengthened and the Bank of Japan offered few signs of shifting its ultra-loose monetary policy.
European indices showed resilience in early trading sessions but lost steam midweek amid rising concerns over stagnation and weak industrial output, particularly in Germany and France. The DAX and CAC 40 both closed the week marginally lower, weighed down by energy sector losses and cautious central bank commentary. The broader Stoxx 600 hovered near flat, reflecting general investor hesitation.
In the United Kingdom, the FTSE 100 had a turbulent five days, first lifted by strong earnings in the banking and mining sectors before reversing gains as UK retail sales came in below expectations. Friday’s session saw a sharp pullback, triggered by a stronger pound and further speculation that the Bank of England could delay any interest rate cuts well into the autumn. Sentiment was further affected by political uncertainties as campaigning intensified ahead of the general election.
Across the Atlantic, US markets remained highly reactive to macroeconomic indicators and tech earnings. The S&P 500 and Nasdaq Composite reached fresh highs midweek before retreating on Friday following a softer-than-expected jobs report and hawkish remarks from Federal Reserve officials. Wall Street’s optimism about AI and big tech growth continues to underpin valuations, but traders are increasingly wary of overextension and volatility ahead of July’s inflation data.
Bond markets reflected this unease, with US Treasury yields fluctuating as investors sought clarity on the Fed’s next move. The 10-year yield ended slightly higher on the week. Meanwhile, gold prices saw modest gains, partly as a hedge against uncertainty, while oil prices ended the week flat amid conflicting global demand forecasts.
Volatility indicators rose slightly, suggesting traders are bracing for a choppier summer period. With earnings season winding down and central banks in a holding pattern, the focus now shifts to economic fundamentals and political developments, especially in the US and UK.
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