Kapital Market Brief | September 2 2025

Top news

·     Eurozone annual consumer inflation rose slightly in August.

·     Later today, the ISM manufacturing index for August will be released, with market consensus expecting a reading of 49 points.

·     Mexico’s IMEF indicators suggest signs of weakness and stagnation. The manufacturing index stood at 45.6 and the services index at 49.9 in August.

·     France’s and the U.K.’s 30-year bonds reached their highest levels in more than a decade amid investor concerns over public finances.

Economic outlook

Eurozone annual consumer inflation rose slightly in August, reaching 2.1%—just above both market consensus and July’s 2.0% reading. By component, in August 2025, food, alcohol, and tobacco inflation stood at 3.2% y/y, services at 3.1% y/y, non-energy industrial goods at 0.8% y/y, and energy at -1.9% y/y. Core inflation came in at 2.3%, in line with consensus expectations. Among the bloc’s largest economies, annual inflation registered 2.1% in Germany, 2.7% in Spain, 0.8% in France, and 1.7% in Italy. Overall, the figures showed a slight uptick; however, a closer look reveals that much of the increase was due to a smaller negative contribution from energy, while most other components edged down. In this context, consensus expectations point to the European Central Bank keeping rates unchanged at its upcoming September meeting.

Markets and stocks

U.S. equity futures traded lower this morning as investors reacted to a court of appeals ruling that declared most of the Trump administration’s tariffs illegal, raising trade uncertainty and the possibility that the government may have to return tax revenues. At the same time, markets remain focused on Friday’s August jobs report, which will be key for the Federal Reserve’s rate decision later this month. In Europe, stocks traded lower, while Asian markets closed mixed in a session marked by the Shanghai Cooperation Organization summit.

In commodities, oil prices rose, supported by the worsening conflict in Ukraine that has disrupted part of Russia’s refining capacity and by trade tensions between the U.S. and India. Meanwhile, gold reached a new all-time high above $3,500 per ounce, driven by expectations of a Fed rate cut this month and its role as a safe-haven asset.

In fixed income, U.S. Treasury yields climbed, with the 10-year yield rising above 4.29% and the 2-year at 3.67%.

Corporate news

Alibaba reported strong revenue growth from artificial intelligence and its cloud business, consolidating its position as a leading tech player in China amid competition with Meituan and JD.com. The company is committing record investments to language models and AI services as part of its long-term strategy.

Nestlé announced the departure of CEO Laurent Freixe after just one year in the role, amid internal tensions and weak performance. He will be replaced by Philipp Navratil, current head of Nespresso, extending a period of management changes that has added to investor uncertainty.

Elliott Management disclosed a $4 billion stake in PepsiCo with the intention of pushing for strategic changes. The activist fund argued that PepsiCo faces competitive and execution challenges and requires greater focus and reinvestment to restore growth.

Kraft Heinz announced it will split into two independent companies: one focused on global brands such as Heinz Ketchup and Kraft Mac & Cheese, and the other on traditional grocery products like Oscar Mayer and Lunchables.