Stay up to date with the latest market trends, economic shifts and key financial developments across the UK, US and Asia.
This week's headlines
- UK growth stalls – GDP numbers for August didn’t show any growth from July. A small rise in services, led by transport and storage, was offset by a drop to production in electronics and pharmaceuticals.
- Europe keeps interest rates on hold – with inflation close to its 2% target, the European Central Bank (ECB) kept rates steady at 2.15%, following a series of cuts over the last year.
- US inflation steady – August’s consumer price index (CPI) showed core inflation (excluding food and energy) rising 0.3% since July, in line with expectations. Prices rises were led by airline fares, new and used vehicles, and apparel.
- UK investment boost – Nvidia and OpenAI have agreed to funnel billions into the UK to build new data centres. More large-scale UK investments are expected to be announced shortly, coinciding with Trump’s visit next week.
- Isreal strikes Qatar – Israel jets struck a building in Qatar, a Western ally, targeting members of Hamas who were negotiating a cease fire in Gaza.
What this means for financial advisers and clients
This week’s news was dominated by political and geopolitical tensions: the bombing of Qatar, NATO jets shooting down Russian drones over Poland, the dismissal of the UK’s ambassador to the US, and the fatal shooting of a right-wing influencer in Utah.
In contrast, markets remained relatively subdued. Oil moved higher after the Qatar bombing on the prospect of greater tension across the Middle East, while steady US inflation only heightened - the already likely - chances of an interest rate cut this month. In the UK, the stalling of GDP was not unexpected, leaving markets and the pound unmoved on the news, as investors await next week’s inflation data and Bank of England’s (BoE) rate decision.
Chart of the week - AI pullback
Source: Apollo; US Census Bureau, Macrobond. Note: Data is six-survey moving average. The survey is conducted biweekly.
Why this matters
The US Census Bureau conducts regular surveys on US firms, which feature questions around their use of AI tools to help produce goods or services within the last two weeks. Over the last few months, a downward trend in usage has started to occur among larger firms (those with over 250 employees), suggesting a slowdown.
If such a trend were to continue, it could spell trouble for mega-tech firms banking on exponential growth in AI adoption and ever-growing demand for more advanced tech. That in turn could call into question their record-high valuations. With the S&P500 and NASDAQ returns so heavily reliant on these companies, a tech slowdown could have an outsized impact on the US and global markets.
Market recap
UK sentiment improves
Despite caution around possible inflation persistence and tax rises, UK markets rose on strong company results and strength in banks and the industrial sector. The FTSE 100 also saw a boost from Anglo American’s merger with Canada’s Teck Resources.
US data boost
US markets rose on weak inflation data and increased expectations of interest rate cuts, alongside outperformance from the communications and technology sector, especially data infrastructure companies such as Oracle and Broadcom.
Emerging markets lead the way
The region was boosted by anticipation of US rate cuts, making their debt look more attractive and lowering their costs of borrowing, alongside initial signs of a recovery in China thanks to improving consumption and policy stimulus.
Gains for oil and gold
Oil rose on fears of escalating tension in the Middle East, before retreating later in the week, while Gold surged on growing economic uncertainty to hit its highest ever rate in inflation-adjusted terms.
| | Weekly Change | YtD Change |
|---|---|---|
| FTSE 100 | 0.98% | 17.05% |
| FTSE 250 | 0.58% | 8.00% |
| S&P 500 | 1.37% | 4.12% |
| NASDAQ | 0.85% | 5.45% |
| FTSE Europe Ex-UK | 0.69% | 17.15% |
| FTSE Emerging Markets | 2.12% | 11.58% |
| Nikkei 225 | 0.89% | 8.57% |
| Brent Crude | 0.12% | -11.12% |
| Gold Spot | 1.89% | 39.02% |
| UK 10yr Gilt yield | -14bps | +4bps |
| US 10yr Treasury yield | -19bps | -54bps |
Source: FE FundInfo, goldprice.org, exchangerates.org.uk, investing.com and finance.yahoo.com. GBP returns as at close of business on Thursday 11th September 2025.
Stay tuned for next week’s market insights
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This article is for financial professionals only. Any information contained within is of a general nature and should not be construed as a form of personal recommendation or financial advice. Nor is the information to be considered an offer or solicitation to deal in any financial instrument or to engage in any investment service or activity. Parmenion accepts no duty of care or liability for loss arising from any person acting, or refraining from acting, as a result of any information contained within this article. All investment carries risk. The value of investments, and the income from them, can go down as well as up and investors may get back less than they put in. Past performance is not a reliable indicator of future returns.
