Kapital Market Brief | September 25 2025

Top news

·     The U.S. economy accelerated in the second quarter of 2025.

·     Retail sales in the U.K. fell in September, marking twelve consecutive months of declines, and are expected to drop again in October amid concerns over the government’s 2026 budget.

·     The Bank of Japan’s monetary policy minutes revealed that some board members could vote for a rate hike in upcoming meetings.

·     The U.S. announced a $20 billion swap line for Argentina, and a potential purchase of its sovereign bonds has not been ruled out.

Economic outlook

The U.S. economy accelerated in the second quarter of 2025. According to the third and final estimate by the Bureau of Economic Analysis (BEA), U.S. GDP grew at an annualized and seasonally adjusted rate of 3.8% q/q in Q2, marking the fastest pace since Q3 2023. The preliminary estimate for Q2 was 3.3%, while Q1 was revised down from -0.5% to -0.6%. The upward revision was mainly driven by stronger-than-previously-estimated household consumption. In terms of domestic demand, final sales to private domestic purchasers rose 2.9% annualized, a notable upward revision from the previously reported 1.9%. Overall, the adjustment underscores the continued strength of the U.S. economy, particularly due to resilient private consumption. As a result, market-implied probabilities for the Federal Reserve to keep rates unchanged at its late-October meeting rose slightly, from 8% to 14%.

Markets and stocks

Futures of major U.S. indices were trading higher this morning, supported by better-than-expected jobs data and an upward GDP revision. The strength of the U.S. economy reinforced expectations that the Federal Reserve will maintain a cautious stance on future rate cuts. Market attention is now focused on tomorrow’s PCE index release. In Europe, equities traded in negative territory, weighed down by trade tensions with the U.S. after the launch of an investigation into medical device and machinery imports. In Asia, performance was mixed, with Japan hitting highs.

In commodities, oil prices retreated after reaching a seven-week high, amid expectations of increased supply from Iraq and Kurdistan. Meanwhile, gold traded around $3,736 per ounce.

In fixed income, the 10-year U.S. Treasury yield stood at 4.19%, while the 2-year yield was at 3.66%, both trending higher.

Citi announced the sale of a 25% stake in Grupo Financiero Banamex to Fernando Chico Pardo for approximately MXN 42 billion. The deal, expected to close in the second half of 2026, is subject to regulatory approval. Once completed, Chico Pardo will assume the chairmanship of Banamex’s board, while Citi will continue focusing on its institutional business in Mexico.

Corporate news

Starbucks announced a $1 billion restructuring plan that includes store closures and 900 job cuts. The plan, led by CEO Brian Niccol, aims to focus operations on profitable locations and modernize 1,000 stores after several quarters of weak sales.

H&M beat expectations with a 40% increase in Q3 operating profit. Cost-control strategies and a focus on its main brand are driving its recovery, though the company warned that U.S. tariffs could pressure margins toward year-end.

Intel is in talks with Apple over a potential investment to support its turnaround. Such a deal would validate Intel’s strategy to regain competitiveness in semiconductors, although Apple is not expected to return to using its processors.