USA

All three major U.S. stock indices attempted to recover last week after a sharp decline. The NASDAQ dipped by 0.18%, the S&P 500 edged down by 0.04%, and the Dow Jones dropped by 0.60%. The week began with significant losses on Monday as global indices fell amid concerns of a potential U.S. recession, sparked by a disappointing July employment report. These fears were further intensified by the Federal Reserve’s apparent hesitation to lower interest rates.

Friday’s weekly jobless claims report, which came in below expectations, helped ease some of the recent concerns about the labor market's strength. The Labor Department reported on Thursday that initial claims for unemployment benefits dropped to 233,000 last week, a decrease of 17,000 from the previous week and below the Dow Jones forecast of 240,000. The report arrived as Wall Street remained on edge due to signs of slowing job growth, which could indicate a potential recession. Stock market futures, which had been negative earlier, turned sharply positive after the report. The 10-year Treasury yield climbed above 4% following the jobless claims data, a level last seen before the disappointing July jobs report on Friday rattled the markets. Analysts continued to debate the possibility of a recession in the second half of 2025. JPMorgan now believes there is only a 30% likelihood that the Federal Reserve and other central banks will keep interest rates elevated for an extended period, down from a 50-50 probability just two months ago. JPMorgan also anticipates that the Fed will reduce rates by half a percentage point in both September and November as inflationary pressures in the U.S. ease.

Europe

Last week, the indices closed in the green. The STOXX Europe 600 Index finished 2.99% higher. Among the major continental indices, France's CAC 40 gained 2.15%, and Spain’s IBEX 35 rose by 2.66%. The UK’s FTSE 100 Index increased by 2.54%, while Germany's DAX closed 2.65% higher. Retail sales in the eurozone unexpectedly declined in June, highlighting the ongoing challenges to a recovery driven by consumer spending. According to data from the EU statistics agency, retail trade fell by 0.3% compared to May, contrary to economists’ predictions of continued growth. Despite rising real incomes, supported by easing inflation and wage growth, the eurozone has not achieved two consecutive months of retail sales growth this year. There is still optimism for a rise in consumer spending in the second half of the year. Consumer confidence in the eurozone reached its highest point in July since the escalation of the Ukraine-Russia conflict in early 2022. Additionally, a potential second interest rate cut by the European Central Bank in September could lower the cost of borrowing and stimulate investment.

Japan

Last week results, major indices closed in red zone. The Nikkei fell by 2.46%, closing at 35,025.00. The TOPIX Index fell by 2.14%, closing at 2.483.30. Bank of Japan Deputy Governor Shinichi Uchida issued a clear strong message following significant financial market volatility in Japan, promising not to raise interest rates during periods of market instability. His remarks, the first public statement from a BOJ board member since the rate hike on July 31, led to a more than 2% drop in the yen against the dollar, a surge in bond futures, and a quick rebound in stocks. Despite these movements, the USD/JPY pair finished the week unchanged.

China

China's export growth unexpectedly decelerated in July, indicating a weakening in global demand that has been sustaining growth in the world's second-largest economy. Exports increased by 7% in July compared to the previous year in dollar terms, falling short of economists' median forecast of a 9.5% rise, according to customs administration data released on Wednesday. Meanwhile, imports exceeded expectations, growing by 7.2%, which led to a reduction in the trade surplus to $84.65 billion from the previous month. The central bank is expected to continue easing policies in the coming months. The Shanghai Composite Index edged down by 0.09%. In Hong Kong, the benchmark Hang Seng Index rose by 2.48%.