Global stock markets closed Thursday, July 31, 2025, with a largely negative tone across major regions, as investors grappled with interest rate uncertainty, global growth concerns, and mixed corporate earnings. While U.S. indices remained relatively stable, both Europe and Asia experienced sharper declines. Tel Aviv markets ended with a mixed performance, reflecting internal sector divergence and resilience in certain bond indices. Here’s a complete breakdown of Thursday’s global performance and what to expect heading into Friday, August 1.

U.S. Markets Close Flat as Volatility Rises

Despite a slight uptick in volatility, U.S. indices were mostly stable on Thursday. The CBOE Volatility Index (VIX) surged +8.01% to 16.72, indicating growing investor caution. Meanwhile, the Nasdaq ended almost flat at 21,122.45 (-0.03%), and the S&P 500 dipped modestly by -0.37% to close at 6,339.39. The Dow Jones Industrial Average was down -0.74% to 44,130.98, and the Russell 2000, which tracks smaller-cap stocks, dropped by -0.93%.

The US Dollar Index edged up +0.06% to 100.03, as investors maintained a risk-off stance. Eyes remain on upcoming job data and signals from the Federal Reserve on the direction of monetary policy.

Europe Posts Broad-Based Declines

European indices faced steep declines on Thursday, reflecting investor concerns over inflation persistence and disappointing corporate earnings in the region. The EURO STOXX 50 fell by -1.36% to 5,319.92, leading the regional downturn.

• CAC 40 in Paris slid -1.14% to 7,771.97
• DAX P in Germany lost -0.81% to 24,065.47
• FTSE 100 in London remained relatively stable, down just -0.05% at 9,132.81

Currency markets also reflected cautious sentiment, with the Euro Index gaining +0.11% to 114.17, while the British Pound Index weakened by -0.28% to 132.10.

Asia Sees Heavy Sell-Offs, Led by South Korea

Asian markets ended Thursday with widespread losses, led by a sharp sell-off in South Korea. The KOSPI Composite Index plunged -3.15% to 3,143.23, its worst single-day decline in weeks, driven by concerns over tech sector valuations and weakening exports.

• Nikkei 225 dropped -0.39% to 40,908.01
• Hang Seng lost -0.12% to 24,743.28
• S&P BSE SENSEX in India edged down -0.16% to 81,055.48
• SSE Composite Index (000001.SS) in Shanghai fell -0.19% to 3,566.55

The Japanese Yen Index declined -0.84%, while the Australian Dollar Index slipped -0.13%.

Tel Aviv Markets End Mixed Despite Global Weakness

Tel Aviv’s stock exchange displayed resilience, with notable strength in the TA-90 and bond sectors, even as the broader TA-125 declined.

• TA-35 fell -0.49% to 3,009.94 with a turnover of ₪1.81 billion
• TA-90 rose +0.62% to 3,326.18, supported by strong mid-cap performance
• TA-125 slipped -0.21% to 3,080.29

Bond indices were largely positive:

• Tel-Bond 60 CPI-linked rose +0.11%
• All-Bond General Index climbed +0.05% with a high turnover of ₪3.75 billion
• Short-Term Bonds (up to 1 year) increased +0.09%

Notably, the TA Sector-Balance Index inched up +0.07%, and the TA-125 Value Index declined slightly by -0.11%, indicating sector-specific divergence.

Outlook for Friday, August 1, 2025

As we move into Friday, markets will closely watch for new U.S. economic data releases, particularly around employment and wage growth. These figures could provide further insight into the Fed’s next rate move. In Europe and Asia, earnings season continues to be a major driver of sentiment, while currency volatility may increase in anticipation of central bank commentary.

For Tel Aviv, expect continued rotation between growth and value segments. Bond markets may see further inflows if global risk sentiment remains fragile.

Stay tuned for potential volatility heading into the weekend, particularly with geopolitical headlines and central bank narratives still weighing on investor confidence.