USA

In the U.S., the week ending March 30, 2025, was marked by a mixed macroeconomic picture and notable market volatility. The PCE price index, the Federal Reserve’s preferred inflation gauge, showed continued upward pressure, raising concerns over the persistence of inflation. Meanwhile, initial jobless claims slightly declined to 224,000, reflecting a still-resilient labor market. The S&P Global Flash U.S. Composite PMI indicated expansion in both manufacturing and services, underscoring ongoing economic activity. However, equity markets closed a turbulent quarter with losses: the S&P 500 ended down 4.6% for Q1, the Nasdaq tumbled 10.4%, and the Dow fell 1.3%. Despite a modest rebound in the final session of the month, the indices were weighed down by concerns over persistent inflation, tech sector underperformance, and anticipation of new trade tariffs.

Europe

European markets faced similar headwinds, with investor sentiment pressured by soft economic data and impending trade restrictions from the U.S. The Eurozone’s manufacturing PMI rose to 48.6 in March—still in contraction territory but improving. Inflation trends continued to ease across the region, but GDP growth remained tepid, constrained by ongoing external uncertainties. European indices broadly declined: the STOXX Europe 600 slipped 1.2% for the week, with Germany’s DAX 40, France’s CAC 40, and Spain’s IBEX 35 all ending lower. The FTSE 100 in the UK also weakened, reflecting the broader caution across global equity markets. The announcement of new U.S. tariffs targeting European exports added to risk-off sentiment, undermining prospects for a near-term rebound.

Japan

Japan’s macro backdrop was less encouraging, as factory activity contracted at the fastest rate in a year. The au JibunBank Manufacturing PMI fell to 48.3 in March, marking the ninth consecutive month in contraction territory. Despite this, firms continued hiring to address persistent labor shortages. Inflationary pressures remained present, largely driven by higher import costs. Market sentiment was rattled by weak industrial data and mounting global trade tensions. The Nikkei 225 fell 4% during the week, with the broader TOPIX also retreating. Japanese equities, having reached record highs earlier in the year, faced profit-taking and concerns about an economic slowdown, particularly as the country remains highly sensitive to shifts in global demand and trade policies.

China

China stood out with a relatively more positive economic tone. The official manufacturing PMI climbed to 50.5 in March—the highest level in a year—signaling a return to expansion, driven by a surge in new orders and production. While inflation remained subdued and consumer demand steady, the broader economy showed signs of resilience despite growing external pressure. Investors largely brushed off news of fresh U.S. tariffs, focusing instead on improving industrial activity. Equity markets responded with moderate gains: the Shanghai Composite rose to 3,348.44, while the Hang Seng Index advanced to 23,206.84. Stability in the labormarket and optimistic manufacturing figures supported risk appetite in the region, differentiating Chinese equities from more fragile global peers.