Indexes reach new highs again
The economic turbulence of late July, which had led the stock market to its worst week in recent months, has now faded into the background by the close of the first full week of August.
It was, however, far from a smooth week. Markets swung between gains and losses, but ultimately, this tariff-driven period proved to be one of the best of the year, with all three key U.S. indexes finishing firmly in positive territory.
The drivers of growth were familiar. First, strong corporate earnings continued to lift expectations for the reporting season. Second, the likelihood of interest rate cuts before year-end increased sharply. Investors are now pinning their hopes on a dovish Federal Reserve, anticipating two – possibly even three – cuts in the months ahead.
As a result, the S&P 500 and NASDAQ Composite once again ended the week at record closing highs. Gains were impressive: the Dow Jones Industrial Average, while more restrained, rose 1.35% over the week, whereas the NASDAQ Composite surged 3.87%. The S&P 500, although trailing the NASDAQ, still posted its best weekly performance since June, up 2.43%.
ITS indexes followed the general upward trend and also posted strong weekly gains. However, unlike their U.S. counterparts, neither the ITS World Index (ITSW) nor the ITS Shariah Index (ITSS) managed to surpass their previous peaks. On Friday, both came within just a few points of record levels, ending the week up 3.25% and 3.00% respectively.
The undisputed star across both U.S. and ITS indexes was Apple (AAPL), whose shares jumped more than 13% over the last three days. The rally followed the company’s announcement of plans to invest $600 billion in new U.S. manufacturing facilities over the next four years. The news was met with strong enthusiasm, lifting not only Apple’s share price but also those of other leading technology companies.
The technology sector as a whole gained 3.85% over the week, outpaced only by the commodities sector, which advanced 5.08%. In tech, gains were broad-based, particularly among the “Magnificent Seven”. In commodities, the rise was driven mainly by gold. The normally calm precious metals market was jolted by President Trump.
First, a U.S. Customs and Border Protection notice indicated that gold bars would not be exempt from the newly announced 39% tariff on goods from Switzerland. This sparked a surge in trading, pushing U.S. gold futures to an all-time high above $3,500 per troy ounce. However, on Friday afternoon the White House said Trump intended to issue an order “clarifying misinformation” about the tariffs, prompting a modest pullback, with futures closing just below record levels.
Either way, the market jitters triggered by weak labour market data in late July and early August have eased, and the market has resumed its upward trend. Whether this momentum will hold remains to be seen, but with uncertainty subsiding, further record highs are likely in the near term. Notably, while the NASDAQ Composite has set 18 all-time highs this year, the Dow Jones has yet to reach one – a milestone investors now appear to be awaiting.
Market outlook for 11 august 2025
The week has begun on a positive note for investors worldwide. In Japan, the Nikkei 225 took over from the U.S. in setting records, hitting a fresh all-time high this morning with a 1.85% gain and coming close to the 42,000 mark.
Positive sentiment is not confined to Japan. All major global indexes are in the green. Trading across Asia is upbeat, with average gains of 0.3-0.5%. European markets opened moderately higher, with leading indexes up 0.2-0.3%. U.S. futures are also following the trend, adding up to 0.2% from Friday’s close.
The most important events of the week are still to come, with plenty on the agenda from both macroeconomic and geopolitical perspectives. The corporate earnings season has largely concluded, leaving Cisco Systems (CSCO) as the only notable company whose results could influence sentiment. Its earnings are due on Wednesday after the close of the main trading session.
However, the week will not be defined by Cisco alone. The focus will be on U.S. inflation data – the consumer price index (CPI) on Tuesday, 12 August, and the producer price index (PPI) on Thursday, 14 August. These releases will shape market mood and could determine whether the Federal Reserve is ready to cut rates at the September FOMC meeting.
Tariffs are another key factor. While the main wave of new duties has already been implemented, the most significant ones remain unresolved. Notably, 12 August marks the expiry of the tariff truce between the U.S. and China, which has so far prevented an escalation of tensions. Investors are hopeful for an extension, but uncertainty persists, especially given the potential global impact of a renewed trade conflict between the world’s two largest economies.
Overall, the week ahead is set to be eventful, with several factors capable of quickly shifting market sentiment. For now, optimism prevails, and if developments unfold favourably – which is still possible – markets may well extend their rally, with more all-time highs on the horizon.