Markets end week mixed amid inflation pressures, ECB uncertainty, and trade optimism

US stocks closed lower on Friday, with the S&P 500 pulling back from record highs as persistent inflation pressures weighed on sentiment. The S&P 500 slipped 0.60%, the Nasdaq dropped 1.20%, and the Dow eased 92 points. Core PCE, the Federal Reserve’s preferred inflation gauge, rose 2.90% year-over-year in July — in line with expectations but the fastest pace since February.

European stocks extended losses as investors weighed the trajectory of global monetary policy against lingering concerns over the region’s economic outlook. The STOXX 50 dropped 0.80% and the STOXX 600 fell 0.60%, as inflation came in slightly below expectations in France and Italy, matched forecasts in Spain, and exceeded them in Germany, leaving markets unsure whether the European Central Bank (ECB) has the room or need for a final rate cut this year. Meanwhile, the euro ended August on a strong note, retaining much of its year-to-date rally amid lingering growth concerns and speculation over the ECB’s next move.

Chinese equities extended gains on Friday, supported by broad market strength and sustained momentum from the previous session. The rally was underpinned by easing US-China trade tensions, government measures to curb aggressive price competition, and ample liquidity, while accelerating fund inflows, rising retail participation, and increased margin buying also boosted sentiment. Artificial intelligence and semiconductor stocks led the advance, drawing renewed investor interest despite lingering concerns over fundamentals. Against this backdrop, the Shanghai Composite added 0.37% to 3 858 points and the Shenzhen Component climbed 0.99% to 12 696, with both benchmarks securing strong monthly gains in August — up 8% and 15%, respectively.

South African markets were little changed as the FTSE/JSE All Share Index slipped 0.02% to 101 836 points, dragged lower by property stocks, while the rand weakened 0.20% to around R17.72 per dollar at the close of business ahead of key US inflation data and local releases on trade, credit, and the budget deficit. Moreover, August marked a standout month as equities recorded their strongest monthly gain since 2006 and the rand its best August performance in two decades, supported by foreign inflows and a softer dollar.

Commodities ended the week broadly subdued, with Brent crude slipping to about $67 per barrel as concerns over slowing US demand and the prospect of higher OPEC+ supply weighed on prices. Gold held steady, supported by safe-haven buying and a softer dollar, extending its recent run of gains. In the platinum group metals, platinum climbed around 0.50% as persistent supply disruptions in South Africa and a tightening global market continued to underpin prices, while palladium also found support from expectations of resilient automotive demand.