The week of August 10 to August 14 produced a market picture that was less uniform than the headline indexes suggest. The S&P 500 gained 0.42% and the Nasdaq Composite gained 0.47%, while the Russell 2000 advanced 1.69%, even as the Dow Jones declined 0.45%. At the same time, the KOSPI surged 10.77%, the strongest move among the major indexes tracked here, underscoring how differently regional markets responded to changing expectations around inflation, interest rates, corporate earnings and geopolitical risk.

U.S. Stocks Hold Up as Inflation Pressure Eases

U.S. equities absorbed several competing signals during the week. July consumer prices increased 0.1% month over month, while annual CPI inflation eased to 3.4% from 3.5% in June. Producer prices were unchanged in July, with annual PPI inflation slowing to 4.7% from 5.5%. The data reduced some pressure for an immediate Federal Reserve rate increase and helped support equity valuations, particularly in technology-related shares.

That backdrop helps explain the resilience of the major U.S. indexes. The Nasdaq Composite gained 0.47%, while the S&P 500 gained 0.42%. The Dow, which has greater exposure to mature industrial and consumer companies, fell 0.45%. Meanwhile, the Russell 2000 gained 1.69%, indicating that the week’s strength was not confined exclusively to the largest technology companies. The divergence suggests that investors were responding not only to earnings expectations but also to the possibility of a less restrictive monetary-policy environment.

Asia Shows a Dramatic Reversal

South Korea was the week’s standout market. The KOSPI gained 10.77%, a substantial rebound following the severe semiconductor-led selloff that hit the market in late July. That earlier decline had been driven heavily by concerns surrounding chipmakers Samsung Electronics and SK Hynix, which together represent more than half of the index’s weighting. The August rebound therefore reflects more than broad risk appetite: it also shows how quickly positioning and sentiment can reverse in a highly concentrated market exposed to the global AI and semiconductor cycle.

Japan’s Nikkei 225 gained 2.60%, adding to the region’s strength, while China’s Shanghai Composite fell 0.99% and Hong Kong’s Hang Seng declined 3.16%. The contrast is significant. It indicates that the week’s Asian performance was not simply a broad regional rally, but a more selective repricing in which South Korean equities benefited disproportionately from renewed confidence in technology and semiconductor demand.

Europe and Israel Follow Different Paths

European equities were comparatively weaker. The DAX gained 0.44%, but the FTSE 100 fell 1.03%, the CAC 40 declined 1.02%, and the MSCI Europe index fell 0.07%. The mixed performance came as markets continued to weigh monetary-policy expectations against geopolitical and energy risks. Reuters noted that rising oil prices and renewed U.S.-Iran tensions remained important sources of uncertainty for global markets during the week.

Israel presented a more stable picture. The TA-35 gained 1.11%, while the broader TA-125 was virtually unchanged, gaining 0.02%. Unlike the sharp regional swings seen in Asia, Israeli equities showed limited net movement over the five-session period. The supplied index data does not identify which sectors drove the performance, so attributing the result specifically to banks, defense companies or institutional flows would go beyond the evidence available. The key observation is that the Israeli market remained relatively contained despite the broader geopolitical backdrop.

The U.S. dollar index fell 0.17% during the week. Its decline was consistent with changing expectations around Federal Reserve policy after softer inflation data and weaker July retail sales. Retail sales unexpectedly fell 0.6% in July, reinforcing concerns about the strength of U.S. consumption and reducing expectations for a September rate increase.

Looking ahead, the central question is whether the combination of resilient corporate earnings and softer U.S. inflation can continue to offset weaker consumption, elevated energy prices and geopolitical uncertainty. The Federal Reserve’s Jackson Hole symposium on August 27–29 is likely to become an important policy signal, while developments in U.S.-Iran relations and incoming economic data will determine whether the current market tolerance for geopolitical risk can persist.