News & Insights

September 2025 – Market Update

By James Timpson CFA

3 Sep 2025

Investment Market Commentary

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Global stocks continued their positive run in August, with most equity markets rising during the month. UK large-cap stocks rallied further, with the FTSE 100 Total Return index now having posted a gain of more than 15% since the start of the year. Of all the G7 nations, the UK has seen the most economic growth this year, with its GDP having grown by 1.1% in the first half of 2025. However another higher-than-expected inflation print has tempered expectations of further rate cuts, and pushed the 30-year gilt yield to its highest level since 1998.

While most equity markets were positive, there were some exceptions. The Indian stock market declined in August as the 50% tariffs imposed by Donald Trump on Indian goods came into effect. Meanwhile there was volatility in the French equity market as Prime Minister François Bayrou announced a vote of no confidence in the government, a move which is likely to lead to further political unrest in the country.

Full round-up of August market performance

In the UK, the FTSE 100 index gained 1.23% while medium and smaller companies, measured by the FTSE 250 ex IT index and the FTSE Small Cap ex IT index respectively, fell 1.49% and 1.63%. In the US, the S&P 500 USD index rose 2.03% while in Europe the Eurostoxx 50 EUR index gathered 0.65%. Japanese stocks measured by the Topix JPY index grew 4.52%.

Emerging markets returns were mostly positive, with the MSCI Emerging Markets index returning 1.56% in local currency terms. Chinese stocks measured by the MSCI China CNY index picked up 4.18% and Latin American equities measured by the MSCI Latin America local currency index surged 6.12%. However Indian stocks measured by the Nifty 50 INR index declined 1.38%

In the fixed income market, UK government bonds, measured by the FTSE Gilts All Stocks index, dropped 0.94% with long dated (over 15 years to maturity) gilts shedding 2.71%. Sterling denominated corporate bonds, measured by the Markit iBoxx Sterling Corporates index, lost 0.36%. In the high yield market, the ICE Bank of America Sterling High Yield index increased 0.83%.

In the commodities market, the S&P GSCI USD index, which consists of a basket of commodities including oil, metals and agricultural items, slipped 0.20%. Brent crude oil futures surrendered 7.58% during the month. In the precious metals markets, the S&P GSCI Gold and Silver indices climbed 5.36% and 9.87% in USD respectively, while in the agricultural markets corn and wheat futures returned 1.02% and -1.00% in USD respectively.

In currency markets, the pound appreciated 2.25% against the US dollar but lost 0.13% versus the euro and 0.26% against the Japanese yen.

James Timpson CFA Head of Asset Management

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