The most striking feature of the week was the contrast between resilient U.S. equity markets and continued weakness in Israeli and South Korean equities. The Nasdaq Composite climbed 1.59% and the S&P 500 advanced 1.05%, supported by optimism surrounding corporate earnings and continued investment in artificial intelligence. Yet the TA-125 fell 2.22%, the TA-35 declined 2.44%, and South Korea’s KOSPI dropped another 2.37%, highlighting how investors continued to differentiate markets based on regional economic and geopolitical risks rather than treating global equities as a single asset class.

At the same time, the U.S. Dollar Index fell 1.68%, signaling reduced demand for the dollar as investors rotated toward risk assets and expectations for monetary policy became more balanced. The divergence across global markets illustrated that confidence remains selective rather than broad-based.

U.S. Markets Extend Gains as Technology Leadership Returns

Wall Street closed the week on a constructive note. The Nasdaq Composite gained 1.59%, outperforming the major U.S. benchmarks as large-cap technology companies continued to benefit from robust earnings expectations and sustained investment in artificial intelligence infrastructure. The S&P 500 rose 1.05%, while the Dow Jones Industrial Average advanced 1.04%, indicating that buying interest broadened beyond technology into industrial and diversified blue-chip companies.

The Russell 2000 edged higher by 0.05%, suggesting that investors remained cautious toward smaller companies despite improving sentiment in large-cap equities. Meanwhile, the U.S. Dollar Index fell 1.68%, a move that generally supports multinational companies by improving the competitiveness of overseas earnings while also reflecting softer demand for traditional safe-haven assets.

Europe Advances While Asian Markets Remain Highly Uneven

European equities maintained positive momentum throughout the week. Germany’s DAX gained 2.11%, France’s CAC 40 advanced 1.64%, the FTSE 100 rose 1.23%, and the broader MSCI Europe Index increased 1.86%. The gains reflected continued confidence in European corporate earnings and improving expectations that slowing inflation could provide greater policy flexibility for regional central banks in the coming months.

Asia presented a much more fragmented picture. Hong Kong’s Hang Seng Index climbed 3.69%, the strongest performance among the major indices reviewed, supported by renewed optimism surrounding Chinese technology and consumer-related shares. Japan’s Nikkei 225 fell 0.88%, while China’s Shanghai Composite gained 0.47%. South Korea remained the week’s notable underperformer as the KOSPI declined 2.37%. Continued weakness in semiconductor-related companies and uncertainty surrounding global electronics demand weighed heavily on Korean equities, underscoring the country’s dependence on export-driven industries.

Israeli Equities Face Profit-Taking Despite Late-Week Recovery

Israel’s equity market experienced another volatile week. The TA-125 fell 2.22%, while the TA-35 declined 2.44%, even though both indices recovered sharply during Friday’s trading session. The weekly decline suggests that investors continued reducing exposure following the strong rebound recorded earlier in July, with financial institutions and large-cap companies experiencing notable profit-taking.

The late-week recovery demonstrated that buying interest remains present, particularly among domestic institutional investors, but it was insufficient to reverse the broader weekly losses. Investor sentiment continues to be influenced by regional geopolitical developments alongside expectations for corporate earnings from Israel’s largest publicly traded companies.

Looking ahead, attention will shift toward the next wave of global corporate earnings, particularly among major technology companies whose results continue to shape broader market sentiment. Investors will also monitor upcoming U.S. labor market data and inflation indicators for additional signals on monetary policy, while developments in China and South Korea will remain important gauges of global manufacturing demand. For Israeli markets, the key question is whether institutional buying can stabilize the TA-35 and TA-125 following two weeks of heightened volatility or whether profit-taking will continue to dominate trading activity.