The US equities market had a strong performance during the week of August 4-8, 2025, with all major indices posting gains. The Nasdaq led the advance with a 3.9% increase to reach a new all-time high, while the S&P 500 and Dow Jones rose 2.4% and 1.3% respectively. The strong risk appetite also lead to a 2-14bps tightening on credit spreads and a 5-10bps widening on US Treasury Bonds yields.
The market rally was primarily driven by exceptional performance in the technology sector, with Apple's 13% surge following a major US investment announcement leading the way. Additional positive factors included increased expectations for a Federal Reserve rate cut following the soft July jobs report, and strong second-quarter corporate earnings results. Positive sentiment was further bolstered by developments in trade negotiations with China, including possible extensions to upcoming deadlines, and the announcement of a meeting between Trump and Putin to discuss a potential peace deal to end the war in Ukraine.
As markets look ahead for this new week, upcoming inflation data releases on Tuesday and Thursday will be closely monitored as investors continue to balance positive corporate momentum against economic uncertainties. Consumer price inflation (CPI) is expected to tick up to 2.8% in 12 months. In the corporate front, Nvidia has reached an agreement with the US government to pay 15% of their Chinese AI chip sales revenue in exchange for export licenses.
