US stocks rallied for a third consecutive month as continual progress on global trade agreements and resilient economic data fueled investor confidence during the month. Agreements with the EU, Japan and other trading partners supported stocks climb, while negotiations with China continued to progress ahead of the August deadline. Corporate earnings reports for the second quarter were broadly stronger than expected, GDP growth was positive, inflation was subdued, and volatility was limited for a change as stocks rallied.
The administration’s tax bill was signed into law on the 4th. Yields rose slightly during the month, and bond prices edged down. Citing uncertainty ahead, the Federal Reserve (Fed) left rates unchanged at their July meeting, despite dissenting votes from committee members and additional pleas from the President to lower rates.
International stocks trailed their US counterparts and performance was muted despite more progress being made on trade agreements and tariff negotiations. Emerging markets rallied, though developed markets pulled back as the dollar appreciated relative to other currencies. Global bonds were relatively flat for the month.
Looking ahead, the free-flowing updates on negotiation deadlines and tariff rates will continue to move markets. Economic data around labor and inflation will be key, especially with jobs reports from May and June being significantly revised down to begin August. Further signs of economic softening will turn attention towards the Fed, with investors anticipating rate cuts to begin again at their September meeting.
July 2025 Market Commentary & Outlook
US stocks rallied for a third consecutive month as continual progress on global trade agreements and resilient economic data fueled investor confidence during the month. Agreements with the EU, Japan and other trading partners supported stocks climb, while negotiations with China continued to progress ahead of the August deadline. Corporate earnings reports for the second quarter were broadly stronger than expected, GDP growth was positive, inflation was subdued, and volatility was limited for a change as stocks rallied.
The administration’s tax bill was signed into law on the 4th. Yields rose slightly during the month, and bond prices edged down. Citing uncertainty ahead, the Federal Reserve (Fed) left rates unchanged at their July meeting, despite dissenting votes from committee members and additional pleas from the President to lower rates.
International stocks trailed their US counterparts and performance was muted despite more progress being made on trade agreements and tariff negotiations. Emerging markets rallied, though developed markets pulled back as the dollar appreciated relative to other currencies. Global bonds were relatively flat for the month.
Looking ahead, the free-flowing updates on negotiation deadlines and tariff rates will continue to move markets. Economic data around labor and inflation will be key, especially with jobs reports from May and June being significantly revised down to begin August. Further signs of economic softening will turn attention towards the Fed, with investors anticipating rate cuts to begin again at their September meeting.