Global markets saw mixed movements over the past week, shaped largely by disappointing U.S. employment data and ongoing concerns about global growth. In the United States, major stock indices generally advanced, though enthusiasm faded by Friday. The Nasdaq Composite rose 1.14%, helped by gains in Apple and Alphabet after an antitrust ruling was perceived as less damaging than feared. The S&P 500 inched up 0.33%, while the Dow Jones Industrial Average slipped 0.32%. Smaller-cap stocks, which are more sensitive to interest rate expectations, also improved.
Labour market data signalled a weakening U.S. economy. Nonfarm payrolls increased by only 22,000 in August, far below July’s revised 79,000 and consensus forecasts of around 77,000. June’s figure was revised to show a net job loss, the first since late 2020. Unemployment climbed to 4.3%, its highest in three years. ADP’s private payrolls report echoed the softness, while job openings fell to a near three-year low, with unemployed workers now outnumbering vacancies for the first time since 2021. Markets responded by pricing in a 100% chance of at least a 0.25% Federal Reserve rate cut in September, with some betting on a larger move. Treasury yields fell sharply, and the benchmark 10-year yield hit its lowest since early April.
Manufacturing remained subdued, with the ISM’s Manufacturing PMI contracting for a sixth consecutive month at 48.7%, though this was a slight improvement on July. By contrast, the services sector showed more resilience, as its PMI rose to 52% on stronger business activity and new orders. Price pressures eased modestly but stayed elevated.
In Europe, the STOXX Europe 600 slipped 0.17%, pressured by a stronger euro and fears of slowing global growth. Germany’s DAX, France’s CAC 40, and Italy’s FTSE MIB all fell, while London’s FTSE 100 gained slightly. Eurozone inflation edged up to 2.1%, close to the European Central Bank’s target, while core inflation held steady at 2.3%. Policymakers signalled rates would likely remain unchanged. Unemployment in the bloc ticked down to 6.2%, but July retail sales dropped 0.5%.
In the UK, mortgage approvals exceeded expectations at over 65,000 in July, hinting that the housing market is stabilising. However, price data were mixed: Nationwide recorded a small monthly fall, while Halifax showed a slight rise. Bank of England Governor Andrew Bailey warned of “considerably more doubt” about further rate reductions, citing inflation risks and labour market concerns.
Asian markets also presented a varied picture. Japan’s Nikkei 225 rose 0.70%, supported by a new U.S.–Japan trade deal and optimism over wage growth, which turned positive in real terms for the first time this year. Speculation mounted that the Bank of Japan may hike rates soon. Chinese equities fell as investors took profits after a recent rally, despite enthusiasm over artificial intelligence advances and government measures to curb industrial overcapacity. Economic headwinds—including trade tensions, property sector weakness, and deflationary pressures—continue to cloud China’s outlook, with many analysts expecting further stimulus in the months ahead.
Weekly Update
9th September 2025
Markets Data
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