Major U.S. stock indexes climbed to fresh record highs. The rally was fueled by the Fed’s decision to deliver its first rate cut of 2025 as it responded to mounting signs of a slowdown in the labour market. While inflation remains elevated, the Fed’s proactive stance to support growth was welcomed by investors, who now expect this could mark the beginning of a broader easing cycle.
In Europe, equities ended the week slightly lower as investors weighed several monetary policy decisions alongside fresh economic data. Industrial production in the euro area rebounded in July, providing a positive signal. Meanwhile, the Bank of England left its key interest rate unchanged at 4%, in line with expectations.
Asian equities saw mixed results. In Japan, markets were steady as the Bank of Japan kept its policy rate unchanged, amid ongoing domestic political uncertainties and global trade concerns. On the other hand, Chinese markets weakened sharply after disappointing data on retail sales and industrial output, with the statistics bureau reporting one of the weakest monthly performances in recent years.
The clear highlight was the Fed’s two-day policy meeting, which concluded with a widely expected rate cut of 25 basis points - the first since December 2024. This move underscored the Fed’s willingness to act pre-emptively to cushion the economy, despite inflation pressures still running above target.
Index |
Current Price |
1 Week Return % |
S&P 500 |
6,664.36 |
1.22% |
DJIA |
46,315.27 |
1.05% |
Nasdaq |
22,631.48 |
2.21% |
FTSE 100 |
9,216.67 |
-0.72% |
Nikkei 225 |
45,045.81 |
0.62% |
Shanghai Composite |
3,820.09 |
-1.30% |
Sensex |
82,626.23 |
0.88% |
ADX Index |
10,099.06 |
0.85% |
Gold |
3,705.80 |
0.84% |
Brent Oil (Brent) |
66.68 |
-0.46% |
The combination of falling interest rates and tax cuts signals a supportive shift in both monetary and fiscal policy over the next 12 months, which we believe should help lift U.S. economic growth. In this environment, we continue to favour U.S. large- and mid-cap stocks — exceptionally high-quality and cyclical names that stand to benefit from lower borrowing costs and a broader market leadership beyond mega-cap technology. At the same time, sectors such as consumer discretionary, financials, and health care could also present attractive opportunities.
Let our investment specialists help you tailor your portfolio for what’s ahead.
Disclaimer
This commentary is provided for informational purposes only and does not constitute investment advice. For detailed insights, contact our investment team.
