Weekly Market Pulse - Week ending August 8, 2025
Market developments
Equities: Global equity markets generally extended gains, with some mixed performance across regions. The S&P 500 in the US hit new records, driven by strong earnings from major technology companies, while the S&P/TSX in Canada also saw gains. European equities rallied, supported by positive earnings reports and hopes for de-escalation in Ukraine, outweighing concerns about tariffs. Asian markets showed mixed signals, with Japan outperforming due to clarity on tariff issues.
Fixed Income: Fixed income markets experienced some volatility, with Treasury yields initially plunging due to increased expectations of rate cuts following weaker jobs data. However, yields edged higher later in the week. There was a mixed performance in Treasuries and a weak 30-year auction led to raised yields at the long end.
Commodities: Commodity markets were significantly impacted by a U.S. government clarification that import tariffs would apply to one-kilo gold bars, causing turmoil and pushing gold futures to record highs. The Food and Agriculture Organization of the United Nations reported a rise in world food prices, driven by meat and vegetable oils, despite declines in other categories
Performance (price return)
SECURITY |
Price |
Week |
1 month |
3 month |
YTD |
Equities ($Local) |
|
|
|
|
|
S&P/TSX Composite |
27,758.68 |
2.73% |
3.18% |
9.92% |
12.26% |
S&P 500 |
6,389.45 |
2.43% |
2.63% |
12.81% |
8.63% |
NASDAQ |
21,450.02 |
3.87% |
5.05% |
19.64% |
11.08% |
DAX |
24,162.86 |
3.15% |
-0.18% |
3.47% |
21.37% |
NIKKEI 225 |
41,820.48 |
2.50% |
5.37% |
13.25% |
4.83% |
Shanghai Composite |
3,635.13 |
2.11% |
3.94% |
8.45% |
8.45% |
Fixed Income (Performance in %) |
|
|
|
|
|
Canada Aggregate Bond |
237.17 |
0.04% |
0.47% |
0.09% |
0.76% |
US Aggregate Bond |
2290.29 |
0.03% |
1.37% |
2.45% |
4.63% |
Europe Aggregate Bond |
246.03 |
0.07% |
0.29% |
0.37% |
0.93% |
US High Yield Bond |
28.26 |
0.41% |
0.74% |
3.76% |
5.33% |
Commodities ($USD) |
|
|
|
|
|
Oil |
63.60 |
-5.54% |
-6.92% |
6.16% |
-11.32% |
Gold |
3395.37 |
0.95% |
2.83% |
2.71% |
29.37% |
Copper |
447.85 |
0.97% |
-20.66% |
-1.81% |
11.23% |
Currencies ($USD) |
|
|
|
|
|
US Dollar Index |
98.26 |
-0.89% |
0.77% |
-2.36% |
-9.43% |
Loonie |
1.3757 |
0.21% |
-0.71% |
1.21% |
4.56% |
Euro |
0.8591 |
0.47% |
-0.72% |
3.68% |
12.43% |
Yen |
147.78 |
-0.26% |
-0.81% |
-1.27% |
6.37% |
Source: Bloomberg, as of August 08, 2025
Central Bank Interest Rates
Central Bank |
Current Rate |
December 2025 |
Bank of Canada |
2.75% |
2.50% |
U.S. Federal Reserve |
4.50% |
3.74% |
European Central Bank |
2.00% |
1.79% |
Bank of England |
4.00% |
3.80% |
Bank of Japan |
0.50% |
0.62% |
Source: Bloomberg, as of August 08, 2025
*Expected rates are based on bond futures pricing
Macro developments
Canada – Unemployment Rate Stagnation
Canada's unemployment rate held steady at 6.9% in July 2025, slightly below expectations but close to a near-four-year high. This aligns with concerns over a large labour supply and economic uncertainty due to tariffs. Unemployment numbers remained stable at 1.6 million, with a notable drop in net employment and a rise in youth unemployment, reflecting slow hiring for seasonal jobs.
U.S. – ISM Services PMI Decline
The ISM Services PMI unexpectedly dropped to 50.1 in July 2025, below the forecast of 51.5. This indicates near stagnation in the services sector, impacted by seasonal and weather factors. Business activity, new orders and inventories all showed declines, while price pressures reached the highest level since October 2022. Employment contracted further and both new exports and imports shifted from expansion to contraction, suggesting tariff tensions are affecting global trade.
International – Bank of England Interest Rate Cut, Eurozone Producer Price Inflation, Eurozone Retail Sales Rebound, S&P China PMI Decline
The Bank of England lowered interest rates by 25 basis points to 4%, the lowest since March 2023. This decision came after a split vote among the Monetary Policy Committee, reflecting divisions on handling inflation and economic softness. Governor Andrew Bailey emphasized that future cuts would be gradual. The BoE also noted potential adjustments to its bond sales program, with markets anticipating another rate cut this year.
In June 2025, Eurozone producer price inflation rose to 0.6% year-over-year, up from 0.3% in May and surpassing market expectations. Price growth for durable and non-durable consumer goods increased, while energy prices fell at a slower rate. Capital goods inflation remained steady, but intermediate goods saw their first price drop since November 2024. Monthly producer prices rose by 0.8% in June, ending a three-month decline.
Retail sales in the Eurozone increased by 0.3% in June 2025, bouncing back from a previous decline but falling short of expectations. There was a recovery in sales across food, non-food products and auto fuel. Among major economies, retail sales rose in Germany, Italy, Spain, the Netherlands, Belgium and Ireland, but fell in France.
The S&P China General Composite PMI fell to 50.8 in July 2025, down from 51.3 in June. Despite the slowdown, this marks two consecutive months of growth in the private sector, mainly driven by services, while manufacturing faced contraction. Although export sales decreased due to weaker external demand, new business saw a rebound. Service providers led employment gains and business confidence improved slightly. Input costs rose quickly, but firms reduced output prices, indicating margin pressure.
Quick look ahead
DATE |
COUNTRY / REGION |
EVENT |
|
SURVEY |
PRIOR |
12-Aug-25 |
United Kingdom |
ILO Unemployment Rate 3Mths |
Jun |
4.7 |
4.7 |
12-Aug-25 |
United States |
CPI MoM |
Jul |
0.2 |
0.3 |
12-Aug-25 |
United States |
CPI Ex Food and Energy MoM |
Jul |
0.3 |
0.2 |
12-Aug-25 |
United States |
CPI YoY |
Jul |
2.8 |
2.7 |
12-Aug-25 |
United States |
CPI Ex Food and Energy YoY |
Jul |
3.0 |
2.9 |
12-Aug-25 |
United States |
CPI Index NSA |
Jul |
323.3 |
322.6 |
12-Aug-25 |
United States |
CPI Core Index SA |
Jul |
|
327.6 |
14-Aug-25 |
Eurozone Aggregate |
GDP SA QoQ |
2Q S |
0.1 |
0.1 |
14-Aug-25 |
Eurozone Aggregate |
GDP SA YoY |
2Q S |
1.4 |
1.4 |
14-Aug-25 |
United States |
PPI Final Demand MoM |
Jul |
0.2 |
|
14-Aug-25 |
United States |
PPI Ex Food and Energy MoM |
Jul |
0.2 |
|
14-Aug-25 |
United States |
PPI Final Demand YoY |
Jul |
2.5 |
2.3 |
14-Aug-25 |
United States |
PPI Ex Food and Energy YoY |
Jul |
3.0 |
2.6 |
14-Aug-25 |
Japan |
GDP SA QoQ |
2Q P |
0.1 |
|
14-Aug-25 |
Japan |
GDP Annualized SA QoQ |
2Q P |
0.3 |
(0.2) |
14-Aug-25 |
Japan |
GDP Nominal SA QoQ |
2Q P |
1.4 |
0.9 |
14-Aug-25 |
China |
Retail Sales YoY |
Jul |
4.6 |
4.8 |
14-Aug-25 |
China |
Retail Sales YTD YoY |
Jul |
|
5.0 |
15-Aug-25 |
United States |
Retail Sales Advance MoM |
Jul |
0.5 |
0.6 |
15-Aug-25 |
United States |
Retail Sales Ex Auto MoM |
Jul |
0.3 |
0.5 |
S = Second
P = Preliminary
The Asset Allocation Team at NEI Investments
Judith Chan, CFA – Vice President, Head of Asset Allocation
Mateo Marks, CFA – Director, Asset Allocation
Adam Ludwick, CFA – Director, Asset Allocation
Anthony Rago, B.A.Sc. – Senior Asset Allocation Analyst
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