{"id":25417,"date":"2025-09-11T12:54:33","date_gmt":"2025-09-11T04:54:33","guid":{"rendered":"https:\/\/www.syfe.com\/magazine\/?p=25417"},"modified":"2025-09-12T11:44:32","modified_gmt":"2025-09-12T03:44:32","slug":"august-2025-market-update-global-markets-rally-fed-interest-rate-cuts-syfe-portfolio-performance","status":"publish","type":"post","link":"https:\/\/www.syfe.com\/magazine\/august-2025-market-update-global-markets-rally-fed-interest-rate-cuts-syfe-portfolio-performance\/","title":{"rendered":"August 2025 Market Update: Global Markets Rally as Fed Rate Cut Looms"},"content":{"rendered":"\n
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Global markets maintained their momentum through August, supported by resilient earnings, a rotation into non-US equities, and mounting expectations that central banks are finally pivoting towards rate cuts. The MSCI All-Country World Index climbed +2.5%<\/strong> for the month, while global bonds rose +1.5%<\/strong>, offering investors a broad-based lift across both equities and fixed income.<\/p>\n\n\n\n

Earnings season provided a welcome tailwind, with the majority of companies posting stronger-than-expected results. However, not all was smooth sailing. Nvidia, one of the key drivers of the artificial intelligence boom, reported robust overall earnings but missed forecasts in its data centre segment. That stumble sparked some caution about whether the AI-fuelled rally can continue at its current pace.<\/p>\n\n\n\n

What stood out most in August was the strength outside of the US. Chinese equities continued their rally, with the MSCI China Index advancing more than +5%<\/strong> and the China Internet ETF (KWEB) surging nearly +7%<\/strong>. Both are now up over +20% year-to-date<\/strong>, delivering a meaningful boost to emerging market allocations. European markets also performed strongly, rising +3% in August<\/strong> and +16% year-to-date<\/strong>, helped by resilient economic data. That said, political uncertainty in France weighed slightly on investor sentiment.<\/p>\n\n\n\n

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Source: Google Finance, as of Sept 2025<\/em><\/p>\n\n\n\n

Meanwhile, gold extended its impressive climb to +24% year-to-date<\/strong>, quietly underscoring its role as a portfolio diversifier and volatility buffer. <\/p>\n\n\n\n

In contrast, commodities such as oil and gas gave back some gains in August after months of strength.<\/p>\n\n\n\n

The monetary policy backdrop remains the most important driver. Weaker US labour market data combined with Federal Reserve Chair Jerome Powell\u2019s dovish remarks at the Jackson Hole symposium reinforced market expectations of a September Fed rate cut<\/strong>. Investors will be closely watching not only the Fed, but also the European Central Bank, Bank of England, and Bank of Japan in the months ahead. Rate decisions, alongside ongoing geopolitical risks, are likely to set the tone as we move into September and the final quarter of 2025.<\/p>\n\n\n\n

Portfolio Performance<\/strong><\/h2>\n\n\n\n
Syfe Portfolio<\/strong><\/td>Performance<\/strong><\/td>Benchmark Performance<\/strong><\/td><\/tr>
Core Equity100<\/strong><\/td>+1.86%<\/td>+1.36%<\/td><\/tr>
Income+<\/strong><\/td>+1.12%<\/td>+0.32%<\/td><\/tr>
REIT+<\/strong><\/td>+4.58%<\/td>+2.28%<\/td><\/tr>
China Growth<\/strong><\/td>+9.07%<\/td>+3.80%<\/td><\/tr>
Healthcare Innovation<\/strong><\/td>+4.67%<\/td>+4.20%<\/td><\/tr>
ESG and Clean Energy<\/strong><\/td>+1.85%<\/td>+1.32%<\/td><\/tr>
Disruptive Tech<\/strong><\/td>+1.43%<\/td>+0.76%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Core Equity100<\/strong><\/h3>\n\n\n\n

The Core Equity100<\/strong><\/a> <\/strong>portfolio delivered a solid +1.86% return in SGD terms<\/strong> in August, comfortably outperforming its benchmark, the MSCI ACWI, which gained +1.36%<\/strong>. Mega-cap tech stocks and the AI rally remained key drivers of performance, though sentiment was tempered by softer US employment data and the weaker dollar. With its high-growth tilt and broad global exposure, Core Equity100 remains well positioned to benefit from long-term structural trends while weathering near-term market shifts.<\/p>\n\n\n\n

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Income+<\/strong><\/h3>\n\n\n\n

Income+<\/strong><\/a> gained +1.12%<\/strong>, outperforming the Bloomberg Global Aggregate Credit Index (SGD-hedged), which rose only +0.32%<\/strong>. Bond yields fluctuated during the month, creating some headwinds, but active management cushioned the impact. Income+ continues to demonstrate resilience by balancing attractive yield potential with strategies designed to limit downside risk\u2014a valuable feature in today\u2019s uncertain rate environment.<\/p>\n\n\n\n

REIT+ (100% REITs)<\/strong><\/h3>\n\n\n\n

The standout performer this month was REIT+<\/strong><\/a>, which returned +4.58%<\/strong>, significantly ahead of the iEdge S-REIT Leaders Index\u2019s +2.28%<\/strong>. Optimism around near-term Fed rate cuts, coupled with improving rental trends, helped drive S-REITs higher. Local reforms and liquidity measures also played a supporting role. With expectations of easier monetary policy and attractive dividend yields, the S-REIT recovery looks set to continue into the year\u2019s final months.<\/p>\n\n\n\n

(Further reading: <\/strong>Why S-REITs Could Be Poised for a Bounceback in 2025<\/strong><\/a>)<\/p>\n\n\n\n

Thematic Portfolios<\/strong><\/h3>\n\n\n\n

All of Syfe\u2019s thematic portfolios<\/a><\/strong> outperformed their respective benchmarks in August, highlighting the value of diversified exposure to high-conviction investment themes:<\/p>\n\n\n\n