USA

During the last week, the U.S. economy demonstrated resilience despite mixed macroeconomic signals. Nonfarm payrolls exceeded expectations, adding 147,000 jobs in June, while the unemployment rate declined slightly to 4.1%. Initial jobless claims fell to 233,000, reflecting continued labor market strength. However, the final Q1 GDP revision showed a contraction of –0.5% annualized, indicating weakening consumer demand. Federal Reserve Chair Jerome Powell cited trade-induced inflation as a key reason for delaying interest rate cuts, signaling the Fed may not ease policy until September. Equity markets responded positively to the strong labor data: the S&P 500 and NASDAQ reached record highs before the Independence Day holiday, supported by falling Treasury yields and investor confidence in U.S. economic stability.

Europe

European markets were cautious amid mixed economic data and growing concerns over impending U.S. tariffs on EU steel, aluminum, and autos set for decision by July 9. Inflation across the eurozone hovered near the European Central Bank’s 2% target, alleviating immediate policy pressure, but weak retail sales in Italy and subdued industrial output indicators pointed to tepid demand. While Germany and France reported stable PMI data, political uncertainty in France and tariff risks kept sentiment muted. The STOXX Europe 600 traded sideways, and major indices like the DAX, FTSE 100, and CAC 40 declined modestly by the end of the week. Sectors tied to global trade, including autos and energy, underperformed, while defensive stocks offered some support.

Japan



Japan saw a notable uptick in economic sentiment as PMI data turned positive for the first time in months. The au Jibun Bank Manufacturing PMI rose to 50.1 in June, signaling a return to expansion, while the Services PMI climbed to 51.7, reflecting strong domestic activity. Although Q1 GDP remained weak, these PMI improvements were interpreted as early signs of recovery. The Nikkei 225 surged by approximately 4.6% over the week, driven by optimism over Japan’s corporate governance reforms, continued yen depreciation, and strong earnings guidance from large-cap exporters. The TOPIX index also posted modest gains, benefiting from broad-based buying across sectors. Investors welcomed signs that Japan’s economy may be stabilizing despite global trade tensions.

China

China's economic data painted a mixed picture. The Caixin Manufacturing PMI returned to expansion territory at 50.4, while the official manufacturing PMI remained slightly below 50, indicating ongoing softness in industrial activity. The services sector showed a modest slowdown, with the Caixin Services PMI easing to 50.6. While authorities maintained supportive policies, structural issues in real estate and uneven demand continued to weigh on confidence. The Shanghai Composite declined by about 0.7% over the week, reflecting cautious investor sentiment. In contrast, the Hong Kong Hang Seng Index gained 3.2%, buoyed by technical buying and investor optimism surrounding Chinese tech shares. However, looming U.S. tariffs and weak domestic consumption kept broader enthusiasm in check.