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Global markets slide, China data deepens growth concerns

Equity markets across the globe fell going into the end of the week, as a sharper slowdown in China’s economy and persistent weakness in technology shares weighed on sentiment. Asian shares slumped on Friday following a wave of losses in US and European indices, with renewed doubts about AI-driven stock valuations and a deepening Chinese property downturn adding to risk aversion. US benchmarks ended Thursday sharply lower due to uncertainty around upcoming economic data and monetary policy. Gold came roaring back this week, trading around USD 4170 per ounce on Friday, set for the best weekly performance in a month with a weekly advance of nearly 5%. Meanwhile, Bitcoin suffered from tech-related fears, dropping below USD 100,000 on Friday, to trade around USD 97,000, its lowest level since May. 

  • Date
  • Author Shane Strowmatt, Senior Investment Writer
  • Reading time 5 minutes

China Shanghai
© Shutterstock

Economic data released Friday indicated that China’s slowdown intensified in October, with fixed-asset investment contracting 1.7% in the first ten months of the year, largely due to a deepening property downturn and weaker infrastructure investment. Industrial output rose 4.9% year-on-year in October, slowing from a 6.5% increase the previous month, while retail sales expanded by 2.9%, marking the lowest level so far this year. New home prices fell 0.5% on a monthly basis and 2.2% year-on-year, underscoring ongoing weakness in the housing market. Despite softer demand and the recent trade deal with the US, Beijing may refrain from additional stimulus in 2025, although more supportive fiscal measures may be forthcoming early next year. Hong Kong’s Hang Seng Index lost 1.5% on Friday, while mainland China’s CSI 300 slipped 1.1%.

Asian stocks retreat on tech sector slide

Asian stock markets outside of China fell on Friday as well, mirroring sharp declines in US equities as worries over stretched valuations in artificial intelligence-related shares, such as Nvidia and Palantir Technologies, pressured sentiment across the region. South Korea’s Kospi led losses with a 3.8% drop, weighed down by a fall in Samsung Electronics and SK Hynix, while Japan’s Nikkei 225 lost 1.8% and SoftBank Group declined 6.6%. Australia’s S&P/ASX 200 was 1.4% weaker. Persistent concerns about the sustainability of rapid gains in AI stocks and uncertainty over potential US interest rate cuts have further dented investor confidence.

US stocks retreat as shutdown ends

US equities declined sharply on Thursday, with the technology-focused Nasdaq Composite falling 2.1% to 24,993.46 points, and the Dow Jones Industrial Average slipping 1.7% to 47,457.22 points, losing ground after reaching a record high the previous day. The S&P 500 finished 1.7% lower at 6737.49 points. Shares in major tech firms struggled, notably electric vehicle maker Tesla, which dropped 6.6%. Investor sentiment was dampened as US President Donald Trump enacted a stopgap budget, ending the government shutdown but raising concerns about upcoming weak economic data and uncertainty over further Federal Reserve rate cuts. Despite the end of the government shutdown, markets will face a period of unclear macroeconomic data guidance: October’s employment report will be released without the unemployment rate, as the 43-day government shutdown prevented collection of household survey data. Only the jobs tally derived from the establishment survey will be published, leaving gaps in labour market analysis for that month.

Swiss producer and import prices decline in October

Switzerland’s Producer and Import Price Index decreased by 0.3% in October, reaching 105.0 points, according to data released by the Federal Statistical Office on Thursday. Prices for computer, electronic and optical products led the decline, with annual price levels for all domestic and imported goods falling by 1.7% compared to October 2024. The monthly decrease reflected lower prices for watches, measuring instruments, electrical equipment and scrap within the Producer Price Index, while machinery, petroleum and natural gas contributed most to the fall in the Import Price Index. However, coins, non-ferrous metals and related products saw price increases over the same period. The Swiss Market Index fell 0.3% to 12,761.43 points on Thursday.

UK economic growth stalls in third quarter

Britain’s economy expanded by 0.1% in the third quarter of 2025, according to data published on Thursday, falling short of forecasts for 0.2% and slowing compared to 0.3% growth in the previous quarter. September saw a 0.1% contraction, largely attributed to the cyberattack at Jaguar Land Rover, which led to a 29% decline in motor vehicle production, the steepest drop since April 2020. The Office for National Statistics reported that this disruption subtracted 0.17 percentage points from GDP growth for the month and 0.06 for the quarter overall. The persistent slow pace of growth is likely to pose challenges for the upcoming November budget and could increase pressure for major tax adjustments.

Euro-area industrial output rises in September

Industrial production in the euro area increased by 0.2% in September, recovering from a 1.1% decline in August, according to Eurostat figures released on Thursday. In the wider EU, output expanded by 0.8% following a 0.9% drop the previous month. Year-on-year, euro-area industrial production climbed by 1.2%, while EU output was 2% higher than in September of last year, led by strong gains in Sweden, Denmark and Greece. European stock indices broadly pulled back on Thursday, the Euro Stoxx 50 dropped 0.8% to 5739.55 points, Germany’s DAX declined 1.4% to 24,041.62 points, and France’s CAC 40 slipped 0.1% to 8232.49 points.

Corporate and economic calendar

Corporate news in focus: Quarterly figures from Allianz and Swiss Re.

Economic data in focus: French Consumer Price Index (08:45), Spanish Consumer Price Index (09:00), euro-area gross domestic product (11:00), euro-area trade balance (11:00), Canadian manufacturing sales (14:30).

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.