August 15, 2025

Hold onto your hats, market fans! Global stock markets have just hit sparkling new highs for the second day in a row. The MSCI All Country World Index climbed up to 954.21, smashing records after its recent peak. In the US, Wall Street was buzzing as the S&P 500 and Nasdaq Composite also hit record heights. The Dow Jones wasn’t far behind, finishing stronger with a neat 1% gain. Which stars shone brightest? The materials, healthcare, and consumer discretionary sectors led the charge, while communication services, consumer staples, and technology stocks slipped slightly. Across the ocean, European stocks jumped 0.54%, nearly touching a two-week high. Japan’s Nikkei danced its way up for the sixth day straight, breaking past the magical 43,000 level to a brand new high. The MSCI Asia-Pacific index, minus Japan, jumped by a juicy 1.54%. What’s cooking this rally? Garrett Melson, a portfolio strategist at Natixis Investment Managers Solutions in Boston, said, "It's largely just a continuation from what we saw yesterday, with inflation obviously being the driver of the rally." The US consumer price index grew a bit less than expected in the year through July, showing President Donald Trump’s tariffs have yet to really hit consumer prices. This gave Wall Street the green light to reach new heights. Melson added, "It's hard to really glean any sort of trends from that report other than maybe just some noise. I think on the whole, it's better than feared and that was enough to kind of spur expectations that the Fed has kind of the green light to go in September." Traders are practically betting on a nearly 94% chance that the Fed will cut interest rates next month — a big jump from about 57% last month! To add to the optimism, Trump signed an executive order pausing steep tariffs on Chinese imports for another 90 days. Treasury Secretary Scott Bessent said a hefty half-point rate cut could be on the cards, especially since recent data show job growth has slowed down a lot. Meanwhile, US Treasury bond prices climbed as yields dipped—signaling more rate cuts ahead. The 2-year note yield dropped to 3.679%, and the 10-year yield slipped to 4.238%. The US dollar weakened slightly against the yen and the Swiss franc, while the euro gained some ground. Not all is shining bright, though. Oil prices took a dip ahead of President Trump’s meeting with Russian President Vladimir Putin. Brent crude fell 0.74% to $65.63 a barrel, and US West Texas Intermediate dropped 0.82% to $62.65. On the flip side, gold glittered a bit more, rising 0.34% to $3,356.49 an ounce. So, what’s the big picture? With inflation cooling, tariffs on pause, and a likely Fed rate cut, the world’s markets could be gearing up for a tasty rally. Investors, keep your eyes peeled — this ride might just continue!

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Tags: Global markets, Federal reserve, Interest rate cut, Wall street records, Us inflation, Trade tariffs,