Weekly Market Review: 29th September 2025

In the United States, markets retreated last week as investors adopted a more cautious stance on the timing of future Federal Reserve rate cuts. Fed Chair Jerome Powell highlighted the increasingly challenging environment for further reductions in interest rates, noting that recent data had shown a rise in unemployment and slower job growth, which justified the September cut. However, with inflation remaining stubbornly high, Powell signaled that there was no clear path for subsequent rate reductions. Despite the cautious tone, markets are still pricing in two additional cuts before year-end, totalling 50 basis points. Equities also dipped as concerns mounted over NVIDIA’s investment in OpenAI and the significant energy requirements to support large-scale AI development. NVIDIA announced plans to invest up to $100 billion in OpenAI, potentially linking two of the most important companies in the global AI ecosystem. The deal will see NVIDIA supply OpenAI with high-performance chips for the creation of large language models, while giving OpenAI the capital to purchase additional chips from NVIDIA and Oracle – effectively creating an AI “circular economy.” The initial investment will be $10 billion, tied to the deployment of OpenAI’s first gigawatt of data centre capacity, but if fully executed, the $100 billion deal would represent the largest single investment in a private company in history. Shares in NVIDIA and Oracle rose on the news, while OpenAI’s valuation reached $500 billion, making it the most valuable private company in the world. Separately, OpenAI confirmed plans to invest $400 billion in the construction of five new data centres across Texas and New Mexico, with CEO Sam Altman expressing confidence in the company’s ability to finance the project. Elsewhere, the largest railroad union in the US endorsed Union Pacific’s proposed $85 billion takeover of Norfolk Southern, clearing a significant early hurdle for what could become the most consequential railroad acquisition of the century. If completed, Union Pacific would become the first transcontinental railroad operator in US history. Meanwhile, US equity markets have regained momentum in recent weeks, with weekly inflows into US equity funds hitting a 2025 high of nearly $58 billion between 15^th – 19^th September, compared with just $1 billion flowing into European funds and zero inflows into Japanese funds. For the week, the S&P 500 and NASDAQ closed down -0.19% and -0.62%, respectively.

In Europe, markets rose modestly in what was a relatively subdued week for European assets. The defence sector was among the strongest performers following comments from President Trump at the UN regarding the war in Ukraine. Nevertheless, European markets broadly tracked US uncertainty over the future path of interest rates, which remain data-dependent. In corporate news, Ørsted, the Danish wind energy developer under heavy pressure in recent weeks, gained a reprieve after a US judge lifted President Trump’s ban on the construction of the Revolution Wind project. The project’s suspension had forced Ørsted to complete a €9 billion rights issue and was costing the company up to $2 million per day since works stopped on the 22^nd August. The decision represents a setback for the US administration but a major win for Ørsted. Meanwhile, KKR has deployed a record amount of capital in Europe so far in 2025, with over $20 billion already committed across the continent, signalling renewed investor confidence. For the week, the Euro Stoxx 50 and STOXX 600 rose 0.67% and 0.02%, respectively.

In the UK, the FTSE 100 traded slightly higher in a muted week for UK equities. One of the most notable corporate moves came from Antofagasta, the only copper miner on the FTSE 100, whose shares jumped more than 9% on Wednesday after US copper producer Freeport-McMoRan shut its Indonesian plant following an accident. The closure sent global copper prices higher, benefitting Antofagasta and other mining stocks, though to a lesser extent. Aerospace companies also gained following President Trump’s NATO-related defence comments at the UN. For the week, the FTSE 100 closed 0.65% higher.