Global markets mixed as Fed outlook and geopolitical risks shape sentiment

US equities closed lower on Friday as macroeconomic headwinds weighed on sentiment. The S&P 500 eased 0.20% from its record high, while the Dow Jones Industrial Average fell 108 points and the Nasdaq 100 declined 0.10%. The University of Michigan’s preliminary August sentiment index fell to 51, below forecasts of 55, while retail sales declined in July by the most in more than a year. Hyperscalers including Meta, Oracle and Amazon fell, although AMD rose 6.50% and SanDisk gained 7.40% following strong gains earlier in the week.

The yield on the 10-year US Treasury note rose towards 4.70%, remaining close to the 19-month high of 4.75% reached earlier in the week. Year-ahead inflation expectations from the University of Michigan rose in August, while concerns over energy prices and the Federal Reserve’s (Fed’s) response to inflation continued to pressure longer-dated bonds. Attention will now turn to the minutes of the Fed’s latest meeting, which included three dissenting votes, alongside US flash purchasing managers’ indices, building permits, trade data and industrial production.

European markets were mixed. The Euro STOXX 50 eased 0.10% to 6 541, while the STOXX Europe 600 declined 0.20% to 658. Germany’s DAX 40 rose 0.50% to 26 432, reaching a fresh record high, while France’s CAC 40 fell 0.20% to 8 637. London’s FTSE 100 extended its decline for a fifth consecutive session as weakness in mining and pharmaceutical shares weighed on the index.

Eurozone economic growth remained resilient, with GDP expanding 1% year-on-year in 2Q26, up from an upwardly revised 0.50% in the previous quarter. On a quarterly basis, the economy grew 0.40%, its strongest pace since the 1Q25. Strong artificial intelligence (AI)-related investment, resilient government spending and one-off factors helped offset the impact of the conflict in Iran and higher energy prices.

Asian markets were mixed. China’s Shanghai Composite traded flat, while the Shenzhen Component gained 0.45% as semiconductor and AI-related shares advanced following stronger-than-expected results from Semiconductor Manufacturing International Corp. Japan’s Nikkei 225 rose 0.59% to 68 714, with the technology sector supporting gains.

South African equities ended marginally lower on Friday. The FTSE/JSE All Share Index declined 0.05% to 114 060.88 points, while the Top 40 Index fell 0.02%. Resource shares gained, with the Resources 10 Index rising 0.84% and Metals & Mining advancing 1.23%, while financials declined 0.55%. The rand weakened 0.07% against the US dollar to R16.20, 0.40% against the British pound to R21.93, and 0.39% against the euro to R18.74.

Commodity markets were mixed. Brent crude oil rose 1.84% to $88.67 per barrel. Gold gained 0.61% to $4 376.59 per ounce, while silver rose 0.37% to $64.69 per ounce and platinum advanced 1.44% to $1 757.20 per ounce.