US markets closed flat last week as investors feared further interest rate hikes from the Federal Reserve, leading to a decrease in optimism. However, markets in Australia, Europe, and the UK saw growth due to strong performance from companies reliant on Chinese exports. In Europe, the European Central Bank hinted at the end of its monetary tightening campaign, while the UK saw a decline in its economy and an unexpected increase in unemployment. In Japan, speculation arose regarding potential Bank of Japan monetary policy normalization. China showed signs of stabilization, with the People's Bank of China cutting its reserve ratio requirement and economists predicting further policy easing. All eyes remain on China for a soft landing.

Global economic sentiment shifted in the week as US data strengthened, and Eurozone data weakened. Weaker global economic data raised concerns about central bank hawkishness, leading to a stronger US dollar and weaker currencies. Crude oil prices remained resilient amid supply concerns, while tech stocks led US markets lower as Apple took a hit.

The week of August 28th to September 1st, 2023, saw a delicate balance between economic indicators and market sentiment play out in markets. The United States enjoyed what appears to be Goldilocks labor conditions, with strong job growth and a tightening labor market.