Choose your location
Finland
English
Austria
Belgium
Denmark
Estonia
Finland
France
Iceland
Ireland
Italy
Latvia
Lithuania
Luxembourg
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
United Kingdom
14 September 2026
Weekly Market Recap
Our Global Investment Solutions team summarise the week's key market events and developments — with insights to support your client conversations and decision-making.
Key resources
Weekly Market article
Weekly Market data
Economic and political backdrop
The UK
The UK economy grew 0.4% in July, beating a consensus estimate for no growth and accelerating from the 0.3% expansion in June. Services accounted for much of the growth, while technology-related industries also saw strong activity. Industrial production rose by 0.2% MoM in July, better than the decline of 0.2% that had been expected.
However, elevated energy prices and high gilt yields remained key headwinds for the country’s economy, raising borrowing costs and adding to fiscal pressures ahead of the government’s Autumn Budget.
The US
Geopolitical developments appeared to drive sentiment during the week. Attacks on Saudi energy infrastructure and continued hostilities involving the US and Iran heightened concerns about disruptions to regional energy supplies and shipping. Oil prices climbed higher, with Brent crude futures rising to nearly USD 110 per barrel before pulling back somewhat on Friday.
US Treasury yields increased alongside oil prices during the week, with the yield on the benchmark 10-year Treasury note rising to about 4.97% and the policy-sensitive two-year Treasury note yield climbing over 4.63%, as investors responded to inflation concerns and shifting monetary policy expectations. Heavy Treasury issuance, a smaller-than-expected buyback operation, and firm inflation data also appeared to put upward pressure on yields.
The Bureau of Labor Statistics reported Thursday that headline producer prices rose 0.4% in August, matching consensus expectations but accelerating from July’s 0.1% increase. Year over year (YoY), producer prices rose 5.4%. Goods prices jumped 1.1%, driven by a 4.2% rise in energy prices, while services prices increased 0.1%. Core producer prices, which exclude food and energy costs, rose a softer-than-expected 0.2%, although the YoY figure rose to 4.6% from 4.3% in July.
Friday morning’s consumer price index (CPI) report provided another signal of persistent inflation heading into the Fed’s upcoming September meeting. Headline consumer inflation was 3.4% YoY in August, unchanged from July and roughly in line with expectations. Core prices rose 0.3% month over month (MoM), above consensus expectations for a 0.2% increase and the fastest pace since April. Annual core inflation was 2.4%, generally in line with estimates. By Friday afternoon, the market-implied probability of a September rate hike had climbed to about 87%, up from roughly 70% before the CPI report and 59% at the end of the prior week, according to the CME FedWatch Tool.
Meanwhile, labour market data provided little evidence of a meaningful deterioration in employment conditions. Initial jobless claims totalled 206,000 for the week ended 5 September, little changed from the prior week’s 207,000, while continuing claims were also little changed at 1.774 million.
The week’s economic calendar wrapped up Friday with a preliminary reading of the University of Michigan’s September Index of Consumer Sentiment, which showed that sentiment deteriorated for the second month in a row. The headline index dropped to 47.8 from 51.7 in August, as “a resurgence in fuel prices and trade tensions” weighed heavily on consumers’ outlook for their personal finances and business conditions. Expectations for inflation in the year ahead jumped to 4.6% from 4.0% in the prior month, reaching the highest level since June.
Europe
As widely expected, the European Central Bank (ECB) raised interest rates by 25bps, taking its key rate to 2.5%. The ECB also raised its inflation projections, reinforcing expectations that monetary policy may need to remain restrictive for longer. ECB President Christine Lagarde noted upside risks to inflation and downside risks to economic growth.
Seasonally adjusted gross domestic product (GDP) in the eurozone grew 0.6% sequentially in the second quarter of 2026, according to data released by Eurostat. Ireland posted the strongest economic growth over the period, followed by Slovenia and Lithuania. The number of people employed in the euro area rose by 0.1% over the same period.
China
China announced plans to provide a combined RMB 360 billion (USD 54 billion) in fresh capital to eight state-owned banks, policy financial institutions, and insurers. The Ministry of Finance is providing RMB 300 billion through special Treasury bonds, with additional capital coming from state tobacco companies. Agricultural Bank of China and Industrial and Commercial Bank of China also announced A-share placements as part of the programme. The measures are intended to strengthen core Tier 1 capital, improve financial system resilience, and enhance institutions’ capacity to support the real economy. Several large state-owned banks and insurers weakened following the announcements as markets absorbed the implications of the new equity issuance.
China’s exports rose 25.0% YoY in August, accelerating from 23.9% in July, supported by strong shipments of technology products amid the global AI infrastructure build-out. Imports increased by 28.2%, up from 27.5% in July but below market expectations. That put China’s trade surplus at USD 119.1 billion, widening from USD 112.5 billion in July. Separately, domestic passenger-car retail sales fell 24% YoY, underscoring the uneven backdrop for household demand.
Inflation also picked up, driven largely by energy and upstream price pressures rather than a broad strengthening in domestic demand. Consumer price inflation rose to 0.8% YoY from 0.5%, while producer prices increased by 3.8%, up from 3.5%, as higher energy, raw material, and selected technology product prices lifted costs. Official data put core consumer inflation, which excludes volatile food and energy prices, at 1.0%, while food prices remained lower year over year. Taken together, the trade and inflation data highlighted continued strength in externally oriented and industrial parts of the economy, alongside a still-uneven domestic recovery.
Japan
The yield on the 10-year Japanese government bond (JGB) rose to 2.98%, from 2.91% at the end of the previous week. Economists surveyed were nearly unanimous in expecting the Bank of Japan (BoJ) to raise its policy rate by 25bps to 1.25% at its 17-18 September meeting, while attention increasingly shifted to the potential pace of subsequent tightening. Board member Kazuyuki Masu warned that the BoJ could ultimately need to raise rates more rapidly if inflation accelerated. Renewed increases in oil prices and a broader global bond sell-off added further upward pressure to yields later in the week.
In the currency markets, the yen strengthened sharply early in the week, appreciating toward JPY 153 against the US dollar on Tuesday from around JPY 156 at the end of the prior week, and remained near its strongest level since February for much of the period. The move reflected growing expectations for a near-term BoJ rate hike and the prospect of faster subsequent tightening. US Treasury Secretary Scott Bessent also reinforced expectations for a stronger yen by expressing confidence in the direction of Japanese policy and signalling a willingness to challenge investors betting against the currency.
Economic data released during the week showed that Japan’s economy remained resilient while wage and price pressures stayed firm. Second-quarter GDP growth was revised up to an annualised rate of 1.4%, from the preliminary 1.1% estimate, although this remained below the 1.9% pace recorded in the first quarter. Real wages rose 2.4% YoY in July, ahead of consensus expectations for 1.8% and up from a revised 2.2% in June, marking a seventh consecutive monthly increase and reinforcing confidence that wage growth is becoming more durable. Meanwhile, the corporate goods price index rose 7.6% YoY in August, slightly above expectations for a 7.4% increase but easing from a revised 7.7% in July, pointing to continued upstream inflation pressures.
Australia
Australian consumer sentiment fell 5.2% MoM to 84.4 in September, largely unwinding August's rise and leaving the index around 12% below its historical average. The decline was broad-based, with all sub-components lower in the month, led by a sharp deterioration in perceptions of current family finances over potential rate hikes and rising fuel costs. Separately, the NAB Business Survey for August showed a marked deterioration, with both confidence and conditions falling, with conditions at a six-year low. The decline was largely driven by a further fall in reported profitability and trading conditions.
Canada
Canada imposed retaliatory tariffs of 15%–50% on hundreds of US goods, including steel, motorcycles, cosmetics and cheese, prompting the Trump administration to respond with import bans on Canadian dairy, alcohol, motorcycles and other products, as well as moves to bar Canadian companies from US government contracting. Prime Minister Carney characterised the US measures as having a "modest" overall impact and signalled no further retaliation for now.
Markets
Equity markets
Last week, the MSCI All Country World Index (MSCI ACWI) lost -0.9% (14.1% YTD).
The S&P 500 Index finished the holiday-shortened week down -0.8% (12.8% YTD), as escalating conflict in the Middle East drove oil prices sharply higher, fuelled inflation concerns, and put upward pressure on Treasury yields. US markets were closed Monday for the Labor Day holiday.
Large-cap growth stocks slightly underperformed their value counterparts, while small caps finished well behind large caps. The Russell 1000 Growth Index returned -0.9% (3.7% YTD), the Russell Value Index -0.8% (22.5% YTD), and the Russell 2000 Index -2.4% (18.1% YTD). The technology-heavy Nasdaq Composite slid -0.6% (13.8% YTD).
In Europe, the MSCI Europe ex-UK Index declined -1.7% (9.8% YTD). European equities came under pressure as escalating US-Iran tensions and disruption in the Strait of Hormuz drove oil and European natural gas prices sharply higher, stoking inflation concerns and pushing government bond yields upward. The ECB raised interest rates. Among major stock indexes, Germany’s DAX Index fell -1.8% (4.4% YTD), France’s CAC 40 Index lost -1.2% (3.0% YTD), and Italy’s FTSE MIB Index gained 0.8% (20.4% YTD). Switzerland’s SMI dropped -4.3% (6.9% YTD). The euro was flat against the US dollar, closing the week at USD 1.16 per EUR.
The FTSE 100 Index in the UK lost -1.6% (10.0% YTD), while the FTSE 250 Index of smaller companies fell -2.5% (9.3% YTD). The British pound was little changed against the US dollar for the week, closing at USD 1.35 per GBP.
Japan’s stock markets fell over the week. The TOPIX Index lost -1.8% (19.6% YTD), and the TOPIX Small Index dropped -2.2% (17.9% YTD). A stronger yen and growing expectations for near-term BoJ tightening weighed on exporters and highly valued growth stocks, while elevated oil prices added to concerns about import costs and inflation. Artificial intelligence (AI)- and semiconductor-related shares showed pockets of strength midweek, particularly cable and optical-fibre stocks exposed to data centre demand, but renewed geopolitical tensions and higher bond yields kept the broader market under pressure.
In Australia, the ASX 200 Index fell -2.8% (4.0% YTD), declining for the fourth consecutive week. Surging oil prices and higher rate expectations drove both materials and financials sectors lower. The Australian government bond yields shifted notably higher with the curve flattening at the margin. The Australian dollar weakened 0.4% against the US dollar as developments in the Middle East weighed on risk sentiment.
In Canada, the S&P/TSX Composite lost -2.2% (16.9% YTD).
Emerging markets and other markets
The MSCI Emerging Markets Index edged down -0.2% (24.6% YTD). South Korea and Brazil contributed positively, while China, Taiwan, and India contributed negatively.
China equities declined over the week, with Hong Kong underperforming the mainland. The CSI 300 Index, the main onshore benchmark, slid -0.8% (-0.8% YTD), while the Shanghai Composite Index retreated -1.0% (-0.4% YTD). Hong Kong's benchmark Hang Seng Index fell -3.1% (-0.7% YTD). The MSCI China Index, which primarily comprises offshore-listed stocks, lost -2.9% (-10.2% YTD). Friday’s broad regional sell-off deepened weekly losses as Brent crude remained elevated after moving above USD 100 per barrel midweek, while higher US Treasury yields added to pressure on risk appetite.
Trading in China technology stocks was volatile and highly selective: Several Hong Kong-listed AI model developers fell sharply over the week amid dilution concerns and intensifying price competition following DeepSeek’s lower-cost V4.1 Flash release, while Tencent-backed Enflame Technology surged by around 179% in its STAR Market debut.
In Saudi Arabia, Saudi stocks ended the week slightly lower as investors weighed continued weakness in the oil sector and renewed geopolitical risks against signs of improvement elsewhere in the economy. Regional tensions intensified after Iran-backed Houthi forces seized the Yemeni port city of Mocha, strengthening their position near the Bab el-Mandeb Strait, a key route for Saudi oil shipments through the Red Sea and an important alternative to the Strait of Hormuz. On Friday, the Saudi Arabian Energy Ministry announced that it had temporarily shut down a critical cross-country oil pipeline after multiple targeted attacks on Thursday as a precaution. The developments raised concerns about further disruption to Saudi energy exports and contributed to higher oil prices.
On the economic front, Saudi Arabia’s real GDP contracted 4.7% YoY in the second quarter, according to the General Authority for Statistics, driven by a 24.8% decline in oil activities. More recent data were somewhat more encouraging: Industrial production rose 10.4% in July from June, led by a 19.0% increase in mining and quarrying, although output remained 8.1% below its year-earlier level.
In a volatile week for Brazil, markets were pulled between a more challenging global backdrop and improving domestic inflation dynamics. Higher oil prices increased concerns about inflation and the interest-rate path, while domestic political uncertainty also contributed to volatility in local rates. The government responded to the oil shock by temporarily reducing federal taxes on gasoline and ethanol and subsidising diesel to limit the pass-through of higher international energy prices to consumers.
Markets received some support late in the week from softer-than-expected inflation, reinforcing expectations for further monetary easing. August consumer prices fell 0.32% MoM, while annual inflation slowed to 4.22% from 4.44%, below consensus expectations. The downside surprise, alongside accumulating evidence of softer economic activity, strengthened expectations that the central bank could deliver another rate cut at its upcoming meeting. However, persistent services inflation, a still-tight labour market, elevated oil prices, and uncertainty around the fiscal outlook kept the longer-term rates backdrop more unsettled, leaving Brazilian assets sensitive to both domestic policy developments and the external energy shock.
Fixed income markets
Last week, the Bloomberg Global Aggregate Index (hedged to USD) fell -0.9% (-0.7% YTD), the Bloomberg Global High Yield Index (hedged to USD) gave back -0.6% (2.6% YTD), and the Bloomberg Emerging Markets Hard Currency Aggregate Index retreated -0.8% (0.3% YTD).
Over the week, the 10-year Treasury yield increased by 19bps to 4.97% from 4.78% (up 80bps YTD). The 2-year Treasury yield rose by 26bps, ending the week at 4.63% from 4.37% (up 115bps YTD).
Over the week, the 10-year German Bund yield increased by 16bp, ending at 3.50% from 3.34% (up 65bps YTD). The 10-year UK gilt yield rose by 21bps, ending the week at 5.34% from 5.13% (up 87bps YTD).
Sign up to receive our weekly market recap every Monday at 9am BST
Our Weekly Market Recap is designed to keep you updated on the previous week's major events and developments. It includes:
- Concise summaries of key market events and trends
- Insights and analysis from our expert team
- Market perspectives to aid your client conversations
Global Investment Solutions Team
Yoram Lustig, CFA, PRM™
Head, Global Investment Solutions, EMEA
Yoram Lustig is the head of Global Investment Solutions, EMEA, and a portfolio manager in the Multi-Asset Division. He also is the chair of the UK and European Investment Committees and a member of the Multi-Asset Steering Committee.
Michael Walsh, CFA, CAIA®, FIA
Solutions Strategist
Michael Walsh is a London-based solutions strategist on the Multi-Asset Solutions team for EMEA. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.
Eva Wu, CFA
Associate Solutions Strategist
Eva Wu is an associate solutions strategist on the Multi-Asset Solutions team in the Multi-Asset Division. She is a vice president of T. Rowe Price International Ltd.
Matt Bance, CFA
Solutions Strategist
Matt Bance is a solutions strategist and portfolio manager on the Multi-Asset Solutions team for the Europe, Middle East, and Africa region. He is a vice president of T. Rowe Price International Ltd.
202609 - 5920387
Notes
All data and index returns cited herein are the property of their respective owners, and provided to T. Rowe Price under license via data sources including Bloomberg Finance L.P., FactSet & RIMES, MSCI, FTSE and S&P. All rights reserved. T. Rowe Price seeks to cite data from sources it deems to be accurate, but it cannot guarantee the accuracy of any data cited herein. Neither T. Rowe Price, nor any of its third-party data vendors make any express or implied warranties or representations and shall have no liability whatsoever with respect to any data and index returns contained herein. The data and index returns cited herein may not be further redistributed or used as the basis for other indices, as a benchmark or as the basis for any other financial product.
The specific securities identified and described are for informational purposes only and do not represent recommendations.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
Important Information
The specific securities identified and described are for informational purposes only and do not represent recommendations.
This material is being furnished for general informational and/or marketing purposes only. The material does not constitute or undertake to give advice of any nature, including fiduciary investment advice, nor is it intended to serve as the primary basis for an investment decision. Prospective investors are recommended to seek independent legal, financial and tax advice before making any investment decision. T. Rowe Price group of companies including T. Rowe Price Associates, Inc. and/or its affiliates receive revenue from T. Rowe Price investment products and services. Past performance is not a guarantee or a reliable indicator of future results. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested.
The material does not constitute a distribution, an offer, an invitation, a personal or general recommendation or solicitation to sell or buy any securities in any jurisdiction or to conduct any particular investment activity. The material has not been reviewed by any regulatory authority in any jurisdiction.Information and opinions presented have been obtained or derived from sources believed to be reliable and current; however, we cannot guarantee the sources’ accuracy or completeness. There is no guarantee that any forecasts made will come to pass. The views contained herein are as of the date written and are subject to change without notice; these views may differ from those of other T. Rowe Price group companies and/or associates. Under no circumstances should the material, in whole or in part, be copied or redistributed without consent from T. Rowe Price.The material is not intended for use by persons in jurisdictions which prohibit or restrict the distribution of the material and in certain countries the material is provided upon specific request. It is not intended for distribution to retail investors in any jurisdiction.
Information and opinions presented have been obtained or derived from sources believed to be reliable and current; however, we cannot guarantee the sources’ accuracy or completeness. There is no guarantee that any forecasts made will come to pass. The views contained herein are as of the date written and are subject to change without notice; these views may differ from those of other T. Rowe Price group companies and/or associates. Under no circumstances should the material, in whole or in part, be copied or redistributed without consent from T. Rowe Price.
The material is not intended for use by persons in jurisdictions which prohibit or restrict the distribution of the material and in certain countries the material is provided upon specific request. It is not intended for distribution to retail investors in any jurisdiction.