Weekly market commentary

Market review

With the 1st August tariff deadline looming, markets breathed a sigh of relief this week as the U.S. secured last-minute trade extensions with Canada and Mexico, pushing their deadlines into September. India, Mexico, and Taiwan remain without finalised agreements and are at risk of facing 30% tariffs unless deals are struck imminently. US-China Trade talks were held in Stockholm with no major breakthrough. Despite this, the broader market reaction was positive: the S&P 500 and Nasdaq both rallied, while the U.S. dollar rebounded modestly, reversing some of the recent weakness.

In the U.S., economic data continued to support a soft-landing narrative – a gradual slowdown without tipping in to recession. Core PCE inflation for June came in at 2.8% YoY with a revision from last month causing the miss, while consumer confidence continued to grow. The Federal Reserve held rates steady at its July meeting with Chair Powell striking a balanced tone by acknowledging progress on inflation but keeping the door open for future cuts. Markets interpreted the stance as moderately dovish, seeing it as a sign that interest rates will come down this year.

Earnings season is now over halfway through, with five of the Magnificent Seven having reported. This week saw strong results from Apple, Amazon, Microsoft, and Meta, all beating expectations. The strength in tech helped push the Nasdaq to a new all-time high, supported by easing macro concerns. Financials like Visa and Mastercard also posted solid numbers driven by resilient consumer spending. Novo Nordisk was a notable laggard with shares falling over 20% after the company cut its 2025 outlook, referring to weaker than expected sales of its weight-loss drug Wegovy due to rising competition. 

Outlook

With earnings season in full swing, investor attention is focused on corporate results and forward guidance. While trade tensions continue to simmer in the background, markets appear to be taking comfort in resilient earnings and signs that trade negotiation may be prevailing over escalation. The coming weeks will be key in assessing whether this optimism is justified. 

Movers table