US equity markets slipped for a third straight session as investors took a breather following weeks of gains, digesting a stream of economic signals that point to a surprisingly resilient economy.
Second-quarter growth was revised upward, marking the strongest expansion in nearly two years, while dropped to their lowest since July, fueling expectations that the Fed may hold its ground for longer before any aggressive .
Still, growing support among central bank officials for easing monetary policy is keeping rate-cut speculation alive, especially amid continued debates over the appropriate benchmark for monetary operations.
Meanwhile, President Trump is back in the headlines after signing an executive order advancing the long-delayed sale of TikTok’s U.S. operations. The deal, reportedly valued at $14 billion, would see American investors, led by Oracle (NYSE:) and backed by Trump allies, take control of the platform’s U.S. algorithm and data infrastructure.
The political undercurrents of this deal are unmistakable, with Trump portraying the move as a win for national security while signaling warmer ties with China’s leadership.
Tech stocks remained in focus, with Intel leading gains as investors bet on further upside driven by recent government support and strategic investments.
Geopolitical tensions surged in Europe as NATO warned Russia that further airspace violations could prompt a forceful response. Last week’s incursion by Russian jets into Estonian territory was deemed deliberate by British, French, and German diplomats, who see it as a direct test of NATO’s resolve.
Trump, despite past criticism of NATO, took a hardline stance by urging European allies to shoot down Russian jets if airspace violations continue—a move welcomed by Eastern European leaders seeking stronger deterrence. Meanwhile, Germany is advancing a plan to use frozen Russian assets to fund a €140 billion interest-free loan for Ukraine.
European bond markets faced pressure. A poorly received UK government bond auction raised investor concerns over fiscal management, while German bunds extended declines amid global rate uncertainty.
Asian markets saw mixed results as near-term economic pressures met longer-term policy moves. In Australia, crypto exchanges face a looming regulatory overhaul, with proposed fines of up to 10% of annual turnover. Meanwhile, Western Sydney Airport is ramping up talks with over 50 airlines, including U.S. carriers, ahead of its commercial launch. Defense and resources stocks continue to shine, with DroneShield shares soaring nearly fivefold this year amid rising global military budgets.
Lynas shares continued to climb as investors bet that rising US-China trade tensions would boost demand for alternative rare earth supply chains. In New Zealand, a record payout from Fonterra has sparked fresh optimism among dairy farmers.
Meanwhile, China is balancing outreach and control; Premier Li Qiang called for stronger US ties, even as Beijing expands its digital currency infrastructure and probes trade friction with Mexico. Despite green energy ambitions, China remains reliant on high-emissions growth, complicating its climate goals.
Investors now turn their focus to today’s release of the index, one of the Fed’s preferred inflation gauges. With volatility ticking higher and geopolitical risks mounting, market sentiment remains fragile heading into the weekend.