USA

Over the past week, U.S. markets posted solid gains as investor sentiment improved amid signs of moderating inflation and softening labor market data. The S&P 500 rose 1.5%, the Nasdaq gained 2.2%, and the Dow climbed 1.2%. Economic data showed the U.S. economy continues to decelerate: initial jobless claims increased to 247,000, the highest since October 2023, while the May non-farm payrolls report added a moderate 139,000 jobs. Meanwhile, the ISM Manufacturing PMI surprised on the upside at 52.3, indicating expansion. Investors interpreted the data as confirmation that the Federal Reserve may cut rates later this year, possibly as early as September, boosting equities — especially in the tech sector, where stocks like Tesla rebounded sharply.

Europe

European equity markets were mixed, reacting to a landmark move by the European Central Bank (ECB) to cut interest rates by 25 basis points—its first rate cut since 2019. The ECB reduced its deposit rate to 2.0% and adjusted inflation forecasts downward, with 2025 CPI now projected at 2.0%. While the DAX and IBEX 35 rose on the news, with the Spanish index logging its eighth straight weekly gain (+0.67%), the broader STOXX Europe 600 ended nearly flat as investors remained cautious. Sectors like mining and utilities in the UK outperformed, but housebuilders lagged following disappointing inflation and construction data. The euro weakened modestly, helping exporters, but geopolitical risks and muted growth expectations capped upside potential.

Japan

Japanese markets faced modest downward pressure for most of the week before recovering slightly on Friday. The Nikkei 225 was largely flat, with a slight midweek dip offset by a late rebound. Japan's Q1 GDP was revised to show a 2.0% quarter-over-quarter contraction, reinforcing concerns about weak domestic demand. The Bank of Japan remained on the sidelines as bond yields rose, prompting minor intervention in the government bond market to maintain financial stability. While manufacturing activity showed signs of stabilization, overall business sentiment remained cautious, particularly amid global market volatility and continued weakness in consumer spending.

China

Chinese markets experienced a modest rebound, buoyed by improved trade sentiment following reports of renewed dialogue with the United States. The Shanghai Composite rose slightly, while the Hang Seng in Hong Kong posted stronger gains by the week’s end. However, fundamental data continued to reflect economic fragility: imports in May fell to their lowest level since 2009, highlighting persistent weakness in domestic demand. Inflation remained muted, with upcoming CPI data expected to show limited price pressures. While Beijing has so far refrained from large-scale stimulus, investors remain hopeful that targeted support will be forthcoming if trade and consumption indicators continue to underperform.