After coming under pressure from rising Treasury yields in the previous week, US equities regained some momentum, helped by a strong set of results from semiconductor giant NVIDIA. The company’s closely watched second-quarter earnings comfortably exceeded expectations, driving a fresh wave of optimism across the technology sector and broader artificial intelligence (AI) value chain. The Nasdaq responded by gaining +0.9%, while the broader S&P 500 advanced +0.5% (both in US dollar terms). Beyond the strong revenue growth delivered during the quarter, investors were particularly encouraged by NVIDIA’s upgraded guidance, which reinforced confidence that demand for AI infrastructure and associated capital expenditure remains robust despite growing questions in recent months around spending levels across the sector¹.
European equities also moved modestly higher, with the MSCI Europe ex UK Index advancing +0.2% in euro terms. Performance across the region was mixed, however, with a clear divergence emerging between some of the continent’s largest markets. German equities enjoyed a particularly strong week, supported by ongoing strength in industrial and technology-related names, while French stocks lagged amid weaker market sentiment. Across the Channel, the FTSE 100 finished broadly unchanged, although trading volumes were relatively subdued. In Asia, sentiment was generally more constructive. Japanese equities advanced, benefiting from the positive read-across from NVIDIA’s results and the renewed optimism surrounding the artificial intelligence (AI) value chain. The Nikkei 225 gained +0.6% in yen terms, with semiconductor and technology-related companies among the strongest performers. Chinese equities also recovered from a weak start to the week, with the Shanghai Composite rising 1.6% in local currency terms. Improved sentiment towards technology hardware and semiconductor stocks was once again a key driver.
A decline in energy prices also provided an additional tailwind for risk assets. Brent crude fell -5.4% over the week to $89.31 per barrel, as markets became increasingly optimistic that oil flows through the Strait of Hormuz would improve and that the risk of a major supply disruption had eased. Lower oil prices helped alleviate some of the inflation concerns that have weighed on both bond and equity markets in recent weeks, supporting a modest recovery in investor sentiment. That optimism, however, has already come under pressure. The fragile détente between the US and Iran appears to have broken down, with both sides resuming attacks on one another for the first time since July. As a result, energy markets quickly reversed course, with Brent crude moving back above $91 per barrel at the time of writing (Tuesday morning).
¹ NVIDIA – Financial Results for Second Quarter Fiscal 2027, 26/08/2026
Macro Data
| Country | Measure | Period | Actual | Forecast | Previous |
|---|---|---|---|---|---|
| UK | N/A | - | - | - | - |
| US | Durable Goods Orders MoM | July | 1.10% | 0.50% | 0.50% |
| Revised GDP QoQ | Q2'26 | 1.50% | 1.50% | 1.50% | |
| Europe | N/A | - | - | - | - |
| Japan | Jobs/Applicants Ratio | July | 1.18 | 1.19 | 1.18 |
| Unemployment Rate | July | 2.40% | 2.50% | 2.50% | |
| China | N/A | - | - | - | - |
| Source: Forex Factory | |||||