Weekly Market Movers — Key Highlights
  • Global equities declined amid heightened geopolitical and inflation concerns.
  • Brent crude surged as Middle East tensions disrupted energy markets.
  • Strong U.S. inflation data raised expectations for further monetary tightening.
  • AI and semiconductor stocks outperformed, led by Intel, Qualcomm.

Global equity markets declined over the week as risk sentiment weakened across both developed and emerging markets amid heightened geopolitical tensions, rising bond yields, and continued uncertainty surrounding the global interest-rate outlook. Strength in artificial intelligence, semiconductor, and communications infrastructure-related stocks provided some support, but these gains were largely outweighed by broader concerns over slowing global growth, elevated energy prices, and persistent geopolitical risks. Rising crude oil prices and strains in sovereign debt markets further dampened investor sentiment, prompting a shift toward defensive positioning and weighing on economically sensitive sectors, including technology and consumer discretionary.

Geopolitical developments remained a key driver of market performance. Escalating hostilities between Iran and the United States, along with continued disruptions to critical shipping routes in the Strait of Hormuz and growing influence of Iran-aligned forces around the Bab el-Mandeb Strait, intensified concerns over global trade and energy supplies. Higher oil prices renewed inflation concerns and added to market volatility, while ongoing strategic tensions between the U.S. and China, divisions among BRICS nations, and the continuing Russia-Ukraine conflict contributed to a cautious investment backdrop. Trade frictions between the United States and Canada also added to uncertainty, reinforcing a risk-off tone across global markets.

Global Updates
  • The MSCI All Country World Index declined over the week as a sharp rise in oil prices heightened inflation concerns, prompting investors to reassess expectations for further monetary tightening by major central banks.
  • The IMF said the global economy has remained resilient despite the Middle East energy shock, projecting around 3% growth in 2026 while warning of elevated risks.
  • The UK economy expanded by 0.4% in July, surpassing expectations, as economists had anticipated no monthly growth following June’s unchanged GDP reading.
  • French energy major TotalEnergies reported a new oil discovery in Angola and agreed to acquire a 40% operated stake in two exploration blocks. The Acacia-5 discovery is expected to increase Block 17 output by 6,000 barrels per day, with production targeted within months.
  • Chinese AI chipmaker Shanghai Enflame Technology surged around 200% on its Shanghai debut after raising 6.12 billion yuan in its IPO, significantly outperforming broader Chinese equities.
  • Indian electric motorcycle maker Ultraviolette Automotive plans to invest ₹7.79 billion in a new manufacturing facility, targeting mass-market expansion amid rising electric two-wheeler demand.
  • Iran-backed Houthi forces captured Yemen’s port city of Mocha and advanced towards strategic Red Sea islands, strengthening their position around the vital Bab el-Mandeb shipping corridor.
  • India will host the BRICS summit in New Delhi this weekend amid divisions over the Iran conflict, which has disrupted the Strait of Hormuz oil flows and lifted crude prices.
  • A Ukrainian drone strike killed two people in Russia’s Tula region, while Russian air attacks injured eight in Kyiv, highlighting the conflict’s continued impact on civilians.
  • Ship movements through the Strait of Hormuz declined to seven transits on Thursday from 11 a day earlier, remaining below the 10-day average of 15.
  • Canada announced a C$350 million aid package for Ukraine to procure air defence interceptors, as Kyiv faces mounting pressure from intensified Russian missile attacks.
U.S. Equity
  • U.S. equity markets ended the volatile week lower, as investors grew increasingly cautious amid rising Treasury yields, elevated oil prices, and persistent inflation concerns. Growth-oriented technology shares came under pressure as higher interest-rate expectations weighed on valuations, while markets also digested stronger-than-expected producer inflation data and awaited key consumer inflation figures ahead of the Federal Reserve’s next policy meeting. The risk-off tone contributed to four consecutive days of losses for major U.S. indices, reflecting investor concerns that inflationary pressures could keep monetary policy restrictive for longer. 
  • The U.S. Producer Price Index (PPI) rose 0.4% in August, tracking at an annualized rate of 5.4% to keep wholesale core inflation significantly above the central bank’s target.
  • The escalating U.S.-Iran conflict intensified supply disruption concerns, driving crude oil prices higher and weighing on broader risk sentiment over the week. Tensions in the Middle East, forced global Brent crude oil prices to surge past $107 per barrel mark.
  • Investors reacted to stronger-than-expected August Producer Price Index (PPI) data, which reinforced concerns that inflation pressures will likely remain elevated. Markets are increasingly pricing in the possibility of a Federal Reserve rate hike ahead of the September policy meeting as inflation and energy prices continue to rise.
  • The White House announced new restrictions on selected Canadian imports and expanded tariff measures, escalating trade tensions between the United States and Canada. Canada’s retaliatory tariffs on $20 billion of American goods also took effect, escalating the cross-border trade friction following the restrictive trade proclamations from the White House.
  • Novartis’ stock price dragged following late-stage clinical trial setbacks for its cardiovascular treatment pelacarsen and its muscular dystrophy drug del-desiran.
  • Intel shares rose during the week after reports indicated the company plans to increase prices on its central processing units (CPUs) by approximately 10% beginning in October, signaling stronger pricing power and efforts to improve profitability. Investor sentiment toward the semiconductor sector was supported by expectations that the price increase could bolster Intel’s revenue outlook amid ongoing demand for advanced computing and AI-related technologies.
  • Corning’s stock rallied during the week after the company secured a multibillion-dollar supply agreement with Verizon Communications to provide high-density optical fiber solutions through 2032. The long-term contract strengthened investor confidence in Corning’s growth.
  • Qualcomm shares gained after the company announced a partnership with Amazon Web Services focused on building artificial intelligence data center infrastructure and optical connectivity solutions.
  • The Department of Commerce took minority equity stakes in quantum computing companies D-Wave Quantum, Rigetti Computing, and Quantinuum in exchange for $100 million each in CHIPS Act funding.
  • The U.S. Treasury Department tripled its longer-dated bond buyback operation to $6 billion during the week, a move aimed at improving market liquidity and addressing strains in the Treasury market that had contributed to distortions in the yield curve.
Fixed Income
  • The Bloomberg U.S. Aggregate Bond Index declined sharply over the week. 
  • The U.S. 10-year Treasury yield rose sharply to 4.942% and the yield on the 2-year note rose to 4.556%, due to the rise in oil prices and the rising concerns regarding rate uncertainty and government debt over the week.
  • The U.S. Dollar Index declined slightly to 99.10 over the week.