On Thursday, the Dow Jones (US30) Index rose by 0.36%, the S&P 500 (US500) gained 0.85%, and the tech-heavy Nasdaq (US100) closed up 0.60%. All three major indices closed at record highs, with expectations that ongoing inflation won’t prevent the Federal Reserve from easing rates next week. The August Consumer Price Index (CPI) report showed that consumer prices increased by 0.4% month-over-month, exceeding expectations, but the annual rate held at 2.9%, in line with projections. Signs of a cooling labor market were exacerbated by jobless claims, which rose by 27,000 to 263,000, the highest since 2021. Traders priced in a 93% chance of a quarter-point rate cut at the September 17th Fed meeting, while the odds of a more significant half-point hike increased.
European stock mostly went up on Thursday. The German DAX (DE40) rose by 0.30%, the French CAC 40 (FR40) closed up 0.80%, the Spanish IBEX35 (ES35) gained 0.68%, and the British FTSE 100 (UK100) closed up 0.78%. Frankfurt’s DAX Index rose on Thursday as investors weighed the expected decision by the European Central Bank (ECB) to hold rates steady. The ECB left its three key interest rates unchanged as expected: the deposit rate at 2.00%, the main refinancing rate at 2.15%, and the marginal lending rate at 2.40%. Inflation remains close to the medium-term 2% target, and the overall outlook is unchanged from June. Among individual stocks, Airbus, Bayer, Heidelberg Materials, Zalando, and Deutsche Bank saw the largest gains, adding between 1% and almost 3%.
Sweden’s annual inflation rate in August 2025 rose to 1.1% from 0.8% in July, confirming preliminary estimates. This is the highest reading since February, although it remains below the Riksbank’s 2% target. On a monthly basis, consumer prices fell by 0.4%, the first decline in five months, reversing the 0.2% increase in July, in line with flash data.
WTI crude oil prices dropped more than 2% to $62.4 per barrel on Thursday, breaking a three-day rally. Concerns over US demand and a global supply surplus outweighed geopolitical risks in the Middle East and Ukraine. The International Energy Agency noted a larger-than-expected increase in supply driven by higher OPEC+ output, and the group itself confirmed plans to boost production from October. Additional pressure came from an unexpected increase of 3.9 million barrels in US crude oil inventories last week.
The US natural gas prices (XNG/USD) fell below the $3/MMBtu mark, nearing a two-week low due to weak LNG export demand and significant storage levels. Government data showed that for the week ending September 5th, storage volume exceeded the expected 71 billion cubic feet, compared to 36 billion cubic feet a year earlier and a five-year average of 56 billion cubic feet. Despite expectations of warmer weather and increased demand, surplus supplies continue to pressure the market.
Silver prices (XAG/USD) rose by 1% on Friday to $42 per ounce, hitting a new 14-year high, as strong expectations for a Federal Reserve rate cut next week supported demand. Markets are currently pricing in about a 93% probability of a 25 basis point rate cut at the September 17th Fed meeting, with the chance of a larger half-percent cut gradually rising. Safe-haven demand further supported precious metals amid ongoing geopolitical tensions.
Asian markets traded without a single trend yesterday. The Japanese Nikkei 225 (JP225) rose by 1.22%, China’s FTSE China A50 (CHA50) jumped 2.08%, Hong Kong’s Hang Seng (HK50) fell by 0.43%, and Australia’s ASX 200 (AU200) closed down 0.29%.
The offshore yuan weakened to 7.11 per dollar as renewed trade concerns negatively affected sentiment. The US has reportedly urged G7 countries to impose high tariffs – from 50% to 100% – on China and India for their continued purchases of Russian oil. This move is part of a broader Washington effort to pressure Moscow into peace talks over the war in Ukraine. In a separate development, China criticized Mexico’s plan to impose tariffs of up to 50% on vehicles and other imports from countries without free trade agreements, many of which are Chinese, calling the move discriminatory and subject to outside pressure.
