Global equity markets ended the week higher. Investors were increasingly optimistic about a rate cut by the Federal Reserve (Fed) in September, due to labour market data published this week. PMI data indicated improved manufacturing in Europe and Asia. U.S. courts permitted Alphabet to retain chrome and android. T Rowe Price Group announced a partnership with Goldman Sachs. Amazon announced a partnership with JetBlue. Norway’s order for British warships raised European defense stocks.

In global geopolitics, the indications of the growing bonhomie between the leaders of China, Russia and India stirred up a storm in Washington DC this week. US Treasury Secretary Scott Bessent and other members of the administration criticized the three leaders. The U.S. Justice Department initiated a probe into potential mortgage fraud by the Fed Governor Lisa Cook. President Trump has suggested the deployment of the National Guard to Chicago to manage crime.

Global Updates
  • The MSCI All Country World Index rose this week, tracking the U.S. markets. The Japanese stock market also rose with the formalization of the 15% tariff rate on Japanese exports to the U.S. European Defense stock also rose, driven by the warships ordered by Norway. Manufacturing data also indicated improved manufacturing activity in Europe and Asia in August 
  • The HCOB Eurozone Manufacturing PMI rose to a three year high of 50.7 in August 2025 from 49.8 in July, entering the expansionary phase for the first time in three years. The expansion was driven by new demand and stronger domestic demand. 
  • Japan’s composite PMI rose to 52.0 in August from 51.6 in July indicating higher private sector activity. The RatingDog China General Services PMI reading of 53 in August indicated an expansion in China’s service sector also. China’s Composite PMI reading of 51.9 also indicated an expansion in private sector activity in August. 
  • The HSBC’s India Services Purchasing Managers’ Index posted a 15-year high reading of 62.9% in August indicating strong service sector activity. India’s GDP growth was also higher than expected at 7.8% in the April to June quarter. 
  • Canada’s trade deficit narrowed to $4.9 billion in July due to exports rising to $61.9 billion and lower imports. The higher exports were driven by the energy and automotive sectors, which offset the declining exports of metal and minerals. 
  • Norway’s $13.5 billion order for British warships raised defense stocks in Europe. 
  • Pharmaceutical drug trial data indicates Novo Nordisk’s Wegovy was more effective than its competitors in reducing heart attack and other risks. 
  • President Trump signed an executive order limiting the tariffs on Japanese automobile imports to 15%. The 15% tariff will be levied on most Japanese imports with a few expectations. 
  • TSMC, Advantest and Lasertec stock prices rose after President Trump reiterated his plans to impose tariffs on semiconductor companies which do not manufacture in the United States. 
  • South Korea’s CPI inflation slowed down to 1.7% in August from 2.1% in July.
  • Japanese company Nidec Corp.’s share price dropped after the company announced an investigation into allegations of improper accounting prices by the group. 
  • Gold prices continued to rise this week to all-time highs due to continuing tariff uncertainty and the growing expectations of a federal rate cut.
  • OPEC+ countries will be discussing increasing their production quotas in the imminent future.  The possibility of a production hike along with the growing U.S. oil stockpiles weighed on oil futures this week.
U.S. Equity
  • The S&P 500, Nasdaq, and Dow Jones indices rose this week, with the S&P 500 closing on a record high this week. Equities rose this week reflecting the investor optimism for a rate cut by the Federal Reserve in September. Weakness in the U.S. labour market reinforced the rate cut expectations. The markets were however cautious due to possible loss of the Fed’s independence following the Trump administration’s attempt to dismiss Fed Governor Lisa Cook. U.S. courts have ruled that the majority of the tariffs imposed by the Trump administration are illegal.
  • The U.S. labor market showed signs of weakening. The jobless claims data for the week ended Aug. 30 rose by 8,000 claims to 237,000. The ADP Private Sector Payroll data reading of 54,000 came in lower than expected and indicated a slowdown in hiring in August.
  • Alphabet added $230 billion in market capitalization after the U.S. courts permitted the company to retain both chrome and android in a resolution of the antitrust case by the U.S. department of Justice
  • Broadcom stock price rose after the company secured a $10 billion new order for custom AI chips. Broadcom also reported a higher than expected fiscal third quarter adjusted EPS of $1.69 on a 22% higher revenue of $15.96 billion. Broadcom has raised its fourth-quarter revenue forecast to $17.4 billion.
  • Amazon has announced a partnership with JetBlue for its internet business Project Kuiper, using low earth orbit satellites. The free Wifi service is scheduled to commence in 2027.
  • T. Rowe Price Group’s stock price surged after the company announced a partnership with Goldman Sachs to provide ‘public-private investment solutions for clients. Goldman will acquire $1 billion in Rowe Price shares to fulfill the agreement. 
  • Apparel retailer American Eagle’s stock price rose after the company posted second quarter earnings of 45 cents on a revenue of $1.28 billion
  • Hewlett Packard stock rose after the company posted higher than expected fiscal third-quarter earnings of 44 cents.
  • Salesforce posted a second quarter adjusted EPS of $2.91 on a revenue of $10.24 billion. However, the company’s stock price declined despite a 10% revenue growth, due to a conservative third quarter revenue forecast in the $10.24 billion to $10.29 billion range.
  • AI software provider C3.ai’s current CEO Thomas Siebel has been replaced by Stephen Ehikian, after the company withdrew its full-year guidance due to the 19% drop in its fiscal first quarter revenue to $70.3 million.
  • GitLab stock declined despite a 29% jump in fiscal second quarter revenue to $236 million and an adjusted EPS of $0.24. CFO Brian Robins will be moving to Snowflake.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index edged lower this week.
  • The U.S. 10-year Treasury yield declined to 4.153% and the yield on the 2-year note declined to 3.581% over the week.
  • The U.S. Dollar Index appreciated to 98.13 this week due to the increasing likelihood of an imminent rate cut by the U.S. Fed.

HCM-030624-063.GWS