The US stocks had a mixed close on Friday. The Dow Jones (US30) fell by 0.59% for the day (+0.89% for the week). The S&P 500 (US500) dropped 0.05% (+1.33% for the week), while the tech-heavy Nasdaq (US100) closed up 0.44% (+1.54% for the week). Investors interpreted weak employment data and low inflation as signs that the Federal Reserve would lower interest rates this week. The Nasdaq jumped, driven by a 7.4% surge in Tesla shares and a 1.7% gain in Microsoft after the company avoided a potential EU antitrust fine, lifting the broader tech sector.
European stock markets were mostly down on Friday. The German DAX (DE40) fell 0.02% (-0.31% for the week), the French CAC 40 (FR40) closed up 0.02% (+1.54% for the week), the Spanish IBEX35 (ES35) dropped 0.08% (+2.86% for the week), and the British FTSE 100 (UK100) closed down 0.15% on Friday (+0.82% for the week). European stocks closed slightly lower on Friday as markets continued to assess the global rate outlook and awaited France’s credit rating from Fitch. At the same time, pharmaceutical stocks across Europe fell after Goldman Sachs downgraded Novartis due to increasing competition from generic brands, causing the company’s shares to drop by 3%, while Roche, AstraZeneca, and GSK all declined by over 1%. On Thursday, the ECB signaled that its easing cycle was complete, with President Lagarde noting that the bank is now in a “good place” and that growth risks appear more balanced.
WTI crude oil prices rose more than 1.5% on Friday. Ukrainian strikes temporarily halted operations at Primorsk, Russia’s main oil-handling port in the Baltic, and hit three pumping stations that supply the Ust-Luga hub. Meanwhile, the US reportedly said it might force G7 allies to impose tariffs of up to 100% on Chinese and Indian purchases of Russian oil, and Canada convened a meeting of finance ministers to discuss additional measures. Further pressure comes from the International Energy Agency’s forecast of a record oil supply surplus next year, with OPEC+ planning to bring idle barrels back to the market in October, albeit at a slower pace.
Asian markets had a strong week. The Japanese Nikkei 225 (JP225) rose by 3.03%, China’s FTSE China A50 (CHA50) climbed 1.88%, Hong Kong’s Hang Seng (HK50) gained 3.73%, and the Australian ASX 200 (AU200) posted a positive result of 0.11% last week. Japanese stocks reached new record highs, following gains on Wall Street. In Japan, investors continued to assess the Bank of Japan’s policy direction amid mixed economic signals and political uncertainty. Prime Minister Shigeru Ishiba recently announced his resignation, facing increasing pressure after a defeat in last year’s elections and deepening divisions within the ruling party. The Hang Seng rose by about 4%, marking its second consecutive weekly gain, fueled by reports that Beijing may direct state-owned banks to help local governments cover unpaid bills. However, gains were capped by concerns that the US could restrict supplies of Chinese medicines and tighten oversight of licensing deals for experimental drugs. Hong Kong-listed Alibaba jumped 7%, and Baidu surged nearly +4% after both companies began using their self-developed chips to train AI models, reducing their reliance on Nvidia.
China’s economy continues to face numerous risks and challenges, as evidenced by weak August 2025 data amid intensifying global issues. Economic activity was also negatively impacted by extreme weather conditions: the hottest heatwave since 1961 and the longest rainy season during the same period. Industrial production grew by 5.2% year-on-year that month, missing forecasts of 5.8% and marking the slowest growth rate in a year, while retail sales increased by 3.4%, the weakest showing in eight months and below the consensus forecast of 3.8%. The unemployment rate rose to a six-month high of 5.3%, and real estate investment continued to contract, highlighting the sector’s prolonged downturn amid tightening regulations on speculation and debt.
The New Zealand dollar declined to $0.596 on Friday but remained near multi-month highs on a weak US dollar. The US dollar was under pressure as slightly higher US consumer inflation data and a sharp increase in jobless claims maintained expectations of Federal Reserve interest rate cuts next week and beyond. At the same time, on the domestic front, the Reserve Bank of New Zealand’s dovish forecasts continue to pressure the currency. RBNZ Governor Christian Hawkesby confirmed on Thursday the central bank’s forecast for another 50 basis points of cuts to the official cash rate by the end of the year, with the pace of easing to be determined by incoming data, particularly next week’s GDP report. Meanwhile, fresh data showed that New Zealand’s manufacturing sector contracted again in August, underscoring the economy’s fragile state.
