Finance The Week That Was

The week ending October 10, 2025, was defined by extreme sentiment reversal. An AI-fueled rally pushed US indices to all-time highs, but this was shattered Friday by the US-China trade war’s re-escalation. Threats of “massive” new US tariffs and strategic Chinese retaliation, including rare earth controls, triggered a global sell-off, overriding all other factors.

Global equity markets surged to fresh records, fueled by intense optimism for U.S. Federal Reserve interest rate cuts, which eclipsed government shutdown concerns. This bullish sentiment was reinforced by the underlying Artificial Intelligence (AI) investment cycle. The S&P 500 set new highs, completing its seventh winning week in nine.

The week ending September 26, 2025, showed global market divergence driven by new U.S. tariffs and rate speculation. The S&P 500 fell 0.3%, supported by in-line inflation data (core PCE at 2.9%) which maintained rate cut hopes. Conversely, India suffered a sharp 2.7% loss due to pharma tariffs and FII outflows. Australia proved resilient, gaining 0.16% from mining sector strength.

The week ending September 19, 2025, was defined by sharp global policy divergence. The Fed’s first interest rate cut in nine months fueled a record-setting U.S. rally, with the technology-centric Nasdaq Composite surging 2.2%. Conversely, European central banks maintained a cautious, hawkish posture. Meanwhile, weak data confirmed China’s deepening economic slowdown, and Japan took a historic step to unwind its vast ETF holdings.

Global equity markets surged on hopes of an impending U.S. Federal Reserve interest rate cut, fuelled by softening economic data. This “risk-on” sentiment lifted indices worldwide, with the Nasdaq and Nikkei reaching new highs. However, the ECB’s hawkish stance created policy divergence, making the global rally narrowly focused and potentially fragile.

The week ending September 5, 2025, saw a fractured global market. U.S. stocks rallied to new highs on Federal Reserve rate cut hopes, interpreting weak jobs data as “bad news is good news”. Europe declined significantly due to sovereign debt fears. Asia mostly gained, while Australia fell. Gold surged as a safe-haven, contrasting with slipping oil prices.