Weekly market commentary

This week was dominated by three familiar themes: artificial intelligence, interest rates and the US dollar. Markets began the week cautiously as investors weighed elevated government bond yields, persistent inflation and the Federal Reserve’s annual Jackson Hole symposium. Sentiment improved significantly after Nvidia delivered another exceptionally strong set of results, helping to reassure investors that the AI investment cycle remains firmly intact. 

The technology giant reported quarterly revenue of $96.2 billion, more than double the level recorded a year ago, and said it expects revenue to grow by around 70% in fiscal 2028, and would expect this to be higher without supply constraints, well ahead of analysts’ expectations. Strong updates from Salesforce and CrowdStrike also pointed to healthy demand for enterprise AI software and cybersecurity. The results lifted US technology shares, while Nvidia recorded its strongest daily performance since April 2025.

Away from technology, investors remained focused on the outlook for interest rates. July US inflation remained above the Federal Reserve’s target, with headline PCE inflation at 3.7% and core inflation at 3.3%. At the same time, a range of economic indicators continued to point to a resilient economy, encouraging investors to question how restrictive current monetary policy really is. Attention therefore turned to Jackson Hole, where Federal Reserve Chair Kevin Warsh was expected to provide greater clarity on the outlook for rates. The Bank of Korea raised interest rates for a second consecutive meeting, while markets continued to anticipate further tightening from both the European Central Bank and the Bank of Japan.

Elsewhere, oil prices moved lower as talks between Iran and Oman raised hopes of improved shipping flows through the Strait of Hormuz, although no final agreement has yet been reached and geopolitical risks remain elevated. Some reports suggest oil flows are much improved over recent weeks, despite official reporting struggling to accurately assess ships passing through. Gold also remained a key focus for investors. Despite rising bond yields, the precious metal has continued to find support from persistent inflation concerns, elevated geopolitical uncertainty and ongoing questions around the long-term sustainability of US fiscal deficits.