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The Week In Markets – 16th August – 22nd August 2025

The UK saw inflation reach its highest level in 18 months in July, rising to 3.8%. The Bank of England (BoE) forecasts inflation to continue to nudge higher, reaching 4% by September — double its 2% target. In a blow to the Chancellor, longer-dated government bond yields rose to 27-year highs, increasing UK borrowing costs and eroding some of the £9.9bn fiscal headroom that Rachel Reeves gave herself.

Interestingly, core inflation (which excludes energy and food prices) also rose to 3.8%, in line with market expectations. However, the month-on-month inflation figures tell a different story, slowing to 0.1% in July from 0.3% previously. Transport costs led the increase, with airline fares seeing their largest July rise since records began. Other sectors such as electricity, fuel prices and soft drinks also contributed to the upward pressure on inflation. Previous Taylor Swift tours in the UK have had a measurable impact on inflation figures. Although beloved by many, the Oasis tour didn’t quite manage to leave the same economic imprint.

Earlier in the month, the Bank of England’s split decision resulted in a 25bps (0.25%) rate cut. Following this latest inflation data, markets are likely to anticipate a slightly longer wait for the next rate cut, as elevated inflation persists. The BoE certainly has a tough job, trying to tackle sticky inflation, while also faced with a deteriorating labour market.

The European Central Bank (ECB) has led the way globally, cutting interest rates eight times over the past year. Despite these rate cuts, inflation has not reaccelerated in the region. Inflation for July held steady at the 2% target for the second consecutive month. The ECB plans to keep rates unchanged in a “wait and watch” stance, maintaining a steady eye on how trade uncertainties may impact the broader economy.

US President Trump has had a busy week, meeting first with Russian President Vladimir Putin and then with Ukrainian President Volodymyr Zelenskyy in an effort to broker a ceasefire deal. The tone of the meeting with Zelenskyy was a far cry from their tense first encounter at the Oval Office back in February, as guarantees are now expected to be formalised over the coming weeks. Ukraine is set to purchase $90 billion worth of US weapons, a move largely backed by several European countries. Despite these developments, a peace deal still appears distant. Putin has refused to agree to a ceasefire, maintaining Russia’s opposition to any short-term truce while both sides continue working towards a broader peace agreement.

US Federal Reserve Chair Jerome Powell is set to speak later today at his eighth and final Jackson Hole Symposium ahead of his term conclusion in May 2026. Markets will be listening closely to his views on the upcoming Fed decision regarding interest rates, and whether we might see the first rate cut of the year.

Sentiment around a potential rate cut at the next meeting remains somewhat lukewarm, as policymakers weigh signs of weakness in the labour market against persistent inflation. The latter is expected to continue rising, partly due to President Trump’s tariffs, which are increasingly impacting import prices and feeding through to producer and consumer costs. Despite this a rate cut is likely but it could be the only one of the year, subject to labour market weakness.

Spare a thought for WH Smith, who saw their share price fall over 40% yesterday after an accounting error had overstated their North American profit by £30m. It’s a reminder about the volatility that can come from direct equities, and why we prefer to remain well diversified, ensuring stock specific risk is kept to a minimum in portfolios.

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

The Week In Markets – 9th August – 15th August 2025

UK jobs data continues to show signs of weakness, with the number of payrolled employees declining for the sixth consecutive month, as well as a drop in job vacancies. Just last week, we noted that the Bank of England’s Monetary Policy Committee was divided over the decision to cut interest rates. This uncertainty played out in real time with mixed messages from the labour market, as the signs of cooling were partially offset by resilient wage growth of 5% (excluding bonuses).

This dilemma was, in many ways, always likely to unfold. UK employers are feeling the squeeze following Chancellor Reeves’ decision to increase National Insurance contributions for businesses — a move that’s impacting staffing and wage decisions. In addition to this fiscal pressure, firms are contending with persistent inflation. While markets had been optimistic about the prospect of another rate cut at either the September or November meetings, attention will now turn to how the data evolves in the coming weeks, with additional rate cuts in 2025 by no means guaranteed.

There was some good news for the Chancellor this week. Britain’s economy grew more than expected in Q2, with GDP rising by 0.3%, outperforming the 0.1% forecast. Economists had anticipated a weaker figure due to the lagged effects of the national insurance increase and weak consumer sentiment. Meanwhile, preambles have begun around what Chancellor Reeves may or may not include in her upcoming Autumn Budget, with expectations leaning towards her going back on her word and introducing further tax hikes.

Ten days after dismissing the previous head of the Bureau of Labor Statistics (BLS), President Trump has nominated economist E.J. Antoni as the new commissioner. The appointment has raised eyebrows, as Antoni has been an outspoken critic of the BLS, previously describing its data as “phoney baloney” and calling for a suspension of the agency’s monthly jobs reports due to what he sees as flawed methodology.

He steps into the role at a turbulent time; the BLS is grappling with sharply declining survey response rates, with some key surveys seeing participation drop below 50% and increasingly volatile data revisions. Antoni’s nomination, which still requires Senate confirmation, signals a potentially significant shift in how US labour market data may be collected and reported going forward.

US CPI data released on Tuesday showed month-on-month inflation for July easing to 0.2%, in line with market expectations. Equity markets responded positively, with the S&P 500 rising 1.1% and the small-cap Russell 2000 index gaining over 2%. However, beneath the headline figures, there were some concerning developments. Airline fares rebounded by 4%, dental costs recorded a record monthly increase of 2.6%, and healthcare costs rose by 0.7% — all signs that tariffs are continuing to filter through supply chains and exert upward pressure on prices.

The Federal Reserve has yet to deliver its first rate cut of 2025, but by the time of its next meeting in September, they will have had the opportunity to assess August’s data more fully.

China and the US have been on a turbulent tariff journey, with retaliatory tariffs reaching as high as 145% earlier this year. However, both sides have now agreed to extend their tariff truce by another 90 days, pushing the deadline to 10 November 2025. This extension maintains the current tariff structure, a 30% US tariff on Chinese imports and a 10% Chinese tariff on American goods. The extension offers companies a valuable window to front-load shipments ahead of the year-end spending surge and prepare for any worst-case scenarios.

Brazil was among the nations hardest hit by President Trump’s recent tariff hikes, with key exports rising to 50%. The move, widely seen as politically motivated, was linked to what Trump called a “witch hunt” against his ally, former President Jair Bolsonaro, who is currently on trial for allegedly attempting to overturn the 2022 election results. In response, Brazil’s government announced an immediate aid package worth $5.55 billion in the form of credit lines and direct government purchases of impacted goods including coffee, beef, footwear and fruit.

Later today, President Trump will meet with President Putin in Alaska, marking their first face-to-face meeting since Trump returned to the Oval Office. The summit will focus on efforts to broker a ceasefire in the ongoing Russia–Ukraine conflict. Trump has stated he will push for peace, and suggested that a second summit, potentially involving Ukrainian President Zelenskyy may be needed to reach a substantive agreement. Earlier in the week Trump spoke with Zelensky and other European leaders ahead of today’s meeting.

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

The Week In Markets – 2nd August – 8th August 2025

The big news coming out of the UK this week was that the Bank of England (BoE) lowered interest rates. This move was largely expected but the vote to cut was anything but straightforward. For the first time in its history, the BoE required a second round of voting to determine their decision. During the first round, four members voted to hold rates steady, four voted for a 0.25% cut and one member voted for a 0.5% cut. With no clear outcome, a second round was required and here we saw five members voting for a 0.25%, enough to cement the decision. This unexpected development surprised markets, as estimates had suggested that seven out of nine policymakers would support a rate cut.

Interest rates were cut from 4.25% to 4%, a move markets had widely anticipated from the BoE. However, the real focus has been the internal division within the Bank itself. The split stems from differing views on how best to respond to the reacceleration in inflation and the rise in unemployment. Governor Andrew Bailey acknowledged there was “genuine uncertainty” regarding the future path of interest rates but reaffirmed the Bank’s commitment to a “gradual and careful” approach. The pound strengthened following the meeting and bond yields surprisingly moved higher, driven by less certainty of future rate cuts from the BoE.

Data reporting plays a crucial role in central banks’ decisions during their rate-cutting cycles. In a dramatic move, US President Donald Trump dismissed the head of the Bureau of Labor Statistics following a weaker-than-expected non-farm payrolls report for July. He accused her, without providing evidence of manipulating the figures, fuelling growing concerns about the reliability of government-released economic data and the frequency of subsequent revisions. Net downward revisions revealed that 258,000 fewer jobs had actually been created in May and June than initially reported, highlighting just how inaccurate recent jobs data has proved to be.

There was further movement within US government departments as Federal Reserve Governor Adriana Kugler announced her immediate retirement at the end of last week. President Trump acted swiftly, appointing Council of Economic Advisers Chairman Stephan Miran to serve out the remainder of Kugler’s term. Trump has repeatedly attempted to pressure Fed policymakers into lowering interest rates this year. By appointing Miran, who has been an outspoken critic of the Fed previously, accusing it of losing focus and accountability—the President appears to be gaining his influence over monetary policy.

Apple CEO Tim Cook visited the Oval Office following President Trump’s announcement that companies committing to US-based manufacturing would be exempt from a proposed 100% tariff on chips and semiconductors. In response, Apple pledged an additional $100 billion investment in US manufacturing over the next four years, bringing its total commitment to $600 billion and creating 20,000 new jobs. Despite needing to reassess its operations in India and facing market concerns over its lag in the AI race, Apple still beat Q2 earnings expectations. The company’s share price rose more than 6% over the week.

Swiss President Karin Sutter made a last-minute trip to Washington in an effort to prevent the enforcement of a 39% tariff on Swiss exports. However, she left empty-handed, having failed to secure a meeting with President Trump or his trade officials. Sutter had hoped to negotiate a reduction to 10%, given that the US is the largest importer of Swiss watches, chocolate, and machinery. While further negotiations between the two countries is expected, the tariffs came into effect on Thursday. Swiss officials have warned of a significant economic blow, with tens of thousands of jobs potentially at risk.

Gold rose to a two-week high on Thursday, after a period of price consolidation. With question marks lingering over US policy and Fed independence, investors are likely flocking to the safe haven asset. We continue to see strong demand for the precious metal from central banks who are increasing their holdings. In a world of uncertainty and inflationary pressures the case for gold continues to remain strong.

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

The Week In Markets – 26th July – 1st August 2025

After months of threats, negotiations, and reversals, we’ve now reached the August 1st Trump tariff deadline. The executive order issued by the US President imposes tariffs on goods from over 90 countries, with the majority facing a 15% rate, however, there are a few notable exceptions.

To start the week, the US and EU reached a trade agreement imposing a 15% import tariff on EU goods. According to European Commission President Ursula von der Leyen, this was “the best we could get,” as it’s half the rate that had been threatened to take effect today. Much to President Trump’s satisfaction, the deal surpassed last week’s $550 billion agreement with Japan, with the EU committing to invest $600 billion in the US and significantly increase its purchases of U.S energy and military equipment.

Despite the agreement, there was pushback from several key politicians, including French President Emmanuel Macron. He criticised the deal, arguing that the EU was not “feared” enough by President Trump and suggesting that this was only a first step, with room for further negotiations. There had been faint hopes that Europe might secure a zero-for-zero tariff agreement.

Earnings season continues, and European drugmaker Novo Nordisk surprised markets by issuing a profit warning and acknowledging headwinds for its blockbuster drugs, Ozempic and Wegovy. Shares plunged down 30% over the week, wiping more than $70 billion off its market cap. Once seen as the leader in the weight-loss industry, Novo’s results appear to have opened the door for competitors like Eli Lilly. The company also announced the successor to former CEO Lars Jorgensen: Maziar Doustdar, previously VP of international operations. He is now tasked with reigniting sales, combating knock-off versions of Novo’s drugs, and reassuring investors that Novo remains a dominant force in the space.

Germany’s GDP contracted by 0.1% in Q2, marking a slowdown from the growth seen in Q1, which had been driven by strong purchases ahead of anticipated US tariffs. Germany is expected to be hit hardest by the newly agreed 15% tariffs due to its heavy reliance on exports. Further economic pain is likely before the planned fiscal stimulus takes effect in 2026.

The US Federal Reserve held its fifth meeting of the year and, as expected, kept interest rates unchanged. The policy decision concluded with a 9–2 vote, with governors Michelle Bowman and Christopher Waller advocating for a rate cut—marking the first time in 30 years that two governors have opposed the majority. What disappointed markets most was the post-meeting commentary from Fed Chair Jerome Powell, who poured cold water on growing expectations of a rate cut in September. Powell stated it was too early to determine whether a cut would be appropriate at the next meeting, noting that the unemployment rate remains low and the labour market resilient, suggesting that current rates have not hindered economic activity.

US Non-Farm Payrolls, released on the first Friday of each month, surprised markets with only 73,000 jobs created in July—well below the forecast of 110,000. This slowdown aligns with broader market expectations and reflects the impact of trade tensions, tariffs, and growing caution among businesses when it comes to hiring, as pressures continue to mount. The news helped increase the probability of a rate cut in September, with US government bond yields tumbling on the news.

US stocks pulled back following the Federal Reserve meeting and in anticipation of the 1st August tariff deadline. However, Meta (formerly Facebook) reported Q2 revenue of $47.5 billion, exceeding expectations and offered a strong outlook for Q3, with capital expenditure showing no signs of slowing. This led to shares rising by 11% on Thursday, bringing the year-to-date gain to over 32%. Microsoft also delivered strong results, highlighting the artificial intelligence (AI) boom is still well in motion and shows no sign of slowing just yet.

It was an eventful week for copper, with the price plunging a staggering 20% on Wednesday. Trump surprised the market by announcing that the 50% import tariff on copper would exclude refined copper cathodes, which are the most commonly traded form of copper.

There was further tariff meddling from Trump on Thursday, as he increased tariffs on a range of countries, including a 35% tariff on Canada and 50% tariff on Brazil. Interestingly, only nine countries were able to strike trade-deals with the US in the run up to today’s deadline, however, many countries have vowed to continue to negotiate. Countries such as Brazil, Canada and India were denied extensions.

It has been a tougher week for markets, with concerns over tariffs weighing heavily over global equities. After a very strong run over recent weeks, where seemingly news flow around trade agreements was positive, this week was a reminder of the fragility of global trade and the unpredictability of US President Trump.  

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

Letter from America

With US tariff negotiations still featuring heavily in the news, Raymond James European Strategist, Jeremy Batstone-Carr, considers recent developments and their potential effects on the global economy.

The Week In Markets – 19th July – 25th July 2025

On Sunday, the ruling coalition led by Japanese Prime Minister Mr Ishiba and the Liberal Democratic Party (LDP) lost its majority in the Upper House of Parliament. This marks the first time since 1955 that the LDP has failed to maintain control of at least one chamber.

Premier Ishiba’s days may well be numbered, having already lost control of the Lower House in elections just nine months ago. Momentum is also shifting towards opposition parties, which have pledged to cut taxes and tighten immigration policies. Intriguingly, the Sanseito party, a far-right populist group founded in 2020, has gained significant traction through YouTube, increasing its representation from one seat to fifteen.

Mr Ishiba is brushing off internal party pressure over his leadership, vowing to remain in office. He reaffirmed his commitment to overseeing tariff negotiations with the United States and tackling high inflation, a relatively new phenomenon for Japan who battled deflationary headwinds for most of this century.

Despite a rocky start to the week, sentiment in Japan improved on Tuesday following an announcement by US President Trump that he had signed the “largest trade deal in history” with Japan. Japan, the fifth-largest trading partner of the United States in goods, currently runs a trade surplus of approximately $70 billion. Key elements of the deal include Japan’s purchase of 100 Boeing aircraft and an increase in defence spending with US firms to $17 billion. The country’s automotive sector—which accounts for over a quarter of its exports to the US—will also benefit from a reduction in tariffs to 15%, sending shares in leading automakers Toyota and Honda up by 14% and 8% respectively over the week.

Continuing on the road of automakers, electric vehicle manufacturer Tesla reported a decline in both revenue and profits in its second-quarter earnings. Revenue fell short of market expectations, coming in at $22.50 billion compared to the forecasted $22.74 billion. Tesla shares have dropped nearly 20% year to date, with much of the volatility attributed to CEO Elon Musk’s four-month tenure as head of the Department of Government Efficiency (D.O.G.E), which ended in a public fallout with President Trump. The company is expected to face a few “rough quarters” ahead, following the withdrawal of US subsidies for electric vehicle manufacturers. However, Musk remains optimistic around future revenue streams, particularly from self-driving services anticipated to launch next year.

The European Central Bank (ECB) met on Thursday and, as expected, left interest rates unchanged at 2.15%. The ECB has diverged notably from other central banks in their rate-cutting cycles, making this pause timely, especially with inflation holding steady at 2% in June. ECB President Christine Lagarde expressed satisfaction with the outcome, stating that the Eurozone is in a “good place” and emphasised the importance of looking ahead. Her comments refer to the anticipated trade deal between the United States and the European Union, which negotiators hope to finalise before the 1st of August deadline.

After three years of negotiations, the UK and India have signed a free trade agreement, agreeing to cut tariffs on goods ranging from motor vehicles to whisky. The deal marks Britain’s largest trade agreement since leaving the EU in 2020—at least until the pending trade deal with the United States is signed and finalised. Aimed at boosting trade by £25 billion, the agreement has lifted sentiment, helping the UK large cap index reach a record close for the fourth consecutive day.

Silver prices continue to surge, reaching their highest level in nearly 14 years—just shy of the $40 per ounce mark. The metal previously hit a record high of $49 in 1980, a level it last approached in 2011.

 

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

The Week In Market – 12th July – 18th July 2025

It was a busy week for data reports, with key releases including UK inflation figures, as well as US inflation and retail sales data. Starting with the UK, the Consumer Price Index (CPI) for June rose to 3.6%—the highest level in over 19 months.

Since inflation fell to 1.7% last September, it has been steadily rising in the UK. In June, inflation exceeded market expectations, climbing to 3.6%, while core inflation (excludes food and energy) rose to 3.7%. Price increases were broad-based, with notable rises in fuel, food, and transport costs, particularly train fares. This upward trend in inflation is becoming an increasing concern for the Bank of England (BoE), especially as it now surpasses inflation levels in the EU and US. The EU, who led the way with a significant rate cutting cycle, have seemingly tamed inflation with the latest reading in line with its 2% target.

Later in the week UK wage growth and unemployment figures were released. Wage growth (excluding bonuses) slowed from 5.3% to 5.0%, while the unemployment rate for May rose to 4.7%. These indicators suggest that the labour market is beginning to soften. As a result, the Bank of England (BoE) may consider a 25-bps (0.25%) rate cut at its August meeting. Governor Andrew Bailey commented this week that the weakening labour market, combined with stagnating economic growth, could provide the BoE with an opportunity to implement its first rate cut since February.

Chancellor Rachel Reeves remains in office after a challenging few weeks, during which she unveiled a new package of measures dubbed the ‘Leeds Reforms.’ Among the initiatives is a government-backed mortgage scheme aimed at encouraging lenders to take on more risk, and a push to channel savings and pensions into equities. These measures are designed to stimulate growth across the UK economy. The Chancellor expressed confidence that the reforms will have a ‘ripple effect’ across sectors, improving returns on savings and putting more money into the pockets of working people.

The proposed acquisition of Japan’s Seven & I Holdings, the parent company of the popular store 7-Eleven, by Canada’s Alimentation Couche-Tard has collapsed. Valued at $46 billion, it would have been the largest buyout in Japanese history. However, Couche-Tard accused Seven & I of failing to engage constructively in negotiations. The deal was widely seen as a litmus test for Japan’s openness to foreign takeovers, and its failure has raised doubts. Shares of Seven & I have dropped 13% over the week, falling to 1,933 yen, well below Couche-Tard’s offer of 2,600 yen per share.

Turning to the US, Consumer Price Index (CPI) data for June showed inflation rising to 2.7%, marking a reacceleration to levels last seen at the beginning of the year. This uptick is viewed as the first sign of tariffs beginning to filter through to consumer prices, with notable increases in the cost of appliances (+1.9%), toys (+1.8%), and sporting goods (+1.4%). While the Federal Reserve is set to meet later this month, markets anticipate that a rate cut is more likely at the September meeting. There is growing expectation that when the Fed does move, it may opt for a larger 50 basis point (0.5%) cut to regain momentum. Fed Governor Christopher Waller expressed support this week for beginning rate cuts as early as the upcoming meeting, though he is widely expected to be outvoted.

Following May’s disappointing decline in US retail sales of -0.9%, June saw a welcome rebound, with sales rising by 0.6%. This exceeded the consensus forecast of a modest 0.1% increase. However, part of the rise is attributed to tariff-driven price increases rather than higher sales volumes. For instance, auto dealerships led the gains, with receipts up 1.2% despite reporting a drop in unit sales. The recovery was evident across several sectors, as consumers initially responded to rising prices by drawing on credit and savings to maintain their standard of living.

We are now into earnings season, and Taiwan Semiconductor Manufacturing Co (TSMC), a global leader in AI chip production, posted record quarterly profits on Thursday. From April to June, net profit reached $13.5 billion, marking a 60% year-on-year increase. The company also expressed optimism for a strong third quarter, as it continues to supply Nvidia who have been given the thumbs up to resume chip sales in the US. TSMC shares are up nearly 9% since the start of the year.

Sterling has weakened over recent weeks against the US Dollar, falling from 1.37 to around 1.34. Signs of a slowing economy and the potential for increased rate cuts have likely driven the marginal weakness. The UK large cap index, which derives approximately 75% of its revenues from overseas responded favourably to the currency moves, breaking through 9,000 for the first time in history.

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors.

The Week In Markets – 5th July – 11th July 2025

History was made once again on Thursday, as AI posterchild Nvidia closed the trading day up 0.75% at $164.10 per share—becoming the first company in history to surpass a $4 trillion market capitalisation. Nvidia has been at the forefront of the AI revolution, powering the ambitions of tech giants like Microsoft, Meta, and Alphabet with their processing units. These chips are central to the massive investments these companies are making in artificial intelligence. Remarkably, Nvidia’s market cap now exceeds the combined value of the entire UK stock market.

Last week, markets were focused on the looming July 9th deadline, when President Trump was expected to reimpose his “Liberation Day” tariffs on countries that had not secured a trade deal with the United States. Despite insisting he would not delay the deadline, Trump ultimately postponed it again, this time to August 1st granting countries a three-week reprieve. However, formal warning letters have already been sent out. Many nations have expressed their intent to finalise agreements, but reaching mutually beneficial terms has proven challenging. The most optimistic takeaway for many countries so far is that “progress” is being made.

Keeping up with the latest tariff announcements has become increasingly difficult, and a sense of malaise has settled over the markets, especially after copper became Trump’s next target. Copper prices in the U.S. surged to an all-time high of $5.84 per lb after Trump calmly declared, “Today we’re doing copper,” followed by, “We’re going to make it 50%.” The U.S. imported 810,000 tons of copper in 2024, a critical material not only for manufacturing and construction but also for military equipment. Markets began to take the announcement seriously when U.S. Commerce Secretary Lutnick confirmed that the copper tariff is expected to be signed into effect at the beginning of next month.

Trump has also turned his attention to Brazil, announcing a sweeping 50% tariff on all Brazilian imports to the U.S. The sudden move followed legal action against Trump’s close ally, former Brazilian President Bolsonaro, who is facing a lawsuit over his alleged role in a plot to overturn the 2022 Brazilian election. Trump responded on his Truth Social platform, calling the case a “witch hunt” and demanding it “end immediately.”  This development further strains the already tense relationship between Trump and current Brazilian President Lula.

In a surprising move this week, X CEO Linda Yaccarino announced her resignation via a tweet. Yaccarino, who joined the company in 2023, was brought on to help owner Elon Musk rebuild relationships with advertisers, many of whom had distanced themselves due to Musk’s controversial public statements. She was also tasked with transforming X into a multi-functional platform, incorporating payments, video, and AI integration. Her tenure can be seen as a partial success, though it was often overshadowed by Musk’s unpredictability, which at times undermined her efforts.

While the week has been dominated by U.S. developments, the UK also made headlines this morning with the release of disappointing GDP data. The UK economy contracted by -0.1% in May, marking the second consecutive month of decline. This came as a surprise to markets, which had forecast a modest 0.1% expansion. The continued downward trend in growth may influence the Bank of England’s upcoming decision on whether to cut interest rates. Meanwhile, pressure is mounting on Chancellor Rachel Reeves, especially following last week’s welfare reform U-turn. She reiterated her commitment to jumpstarting economic growth and delivering on her promises.

Despite the week’s unpredictability, equity markets have continued their upward momentum, with both the S&P 500 and Nasdaq reaching new all-time highs. The FTSE 100 also hit a record high, buoyed by strong performances in the mining and healthcare sectors.

Nathan Amaning, Investment Analyst

Risk warning:  With investing, your capital is at risk. The value of investments and the income from them can go down as well as up and you may not recover the amount of your initial investment. Certain investments carry a higher degree of risk than others and are, therefore, unsuitable for some investors

Investment Strategy Quarterly – July 2025

Our latest Investment Strategy Quarterly considers the complexities of today’s markets while drawing insights from the past. This edition includes the historic and current impact of tariffs, asks if the US still holds its safe-haven appeal for investors, and examines energy costs and AI. Closer to home, we take a look at Labour’s first year in office.

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