Last week brought earnings from some corporate juggernauts as trade deals continued to be in the spotlight. Amid these developments, now is a great time to share an overview of what happened and what may be ahead. Read on for a bite-sized summary of what you should know.
Weekly Stock Index Performance
Trade Deals & All-Time Highs
Earnings Magnificence
Housing Setback
This Week: It’s a Big One
That’s it for this week’s update! If you’d like to delve into these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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Last week brought mixed monthly inflation data and various interpretations, while retail sales surged as earnings season began. So, now is an opportune time to share an overview of what happened and what could be ahead. Read on for a bite-sized summary of what you should know.
Weekly Stock Index Performance
Mixed Inflation Interpretation
Retail Sales & Consumer Sentiment Bounce
The Week Ahead
That’s it for this week’s update! If you’d like to delve into these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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Last week was all about stirring developments, such as the One Big Beautiful Bill Act and notable tariff developments. Read on for highlights of what you should know and how the market outlook is shaping up.
Stock Index Performance
Big Beautiful Budget
Tariffs & Trade Policy
Fed Watch
The Week Ahead
That’s it for this week’s update! If you’d like to delve into these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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After a turbulent yet resilient first six months of the year, we wanted to share an updated macroeconomic perspective and investment outlook.
Overview
The U.S. economy has displayed stamina in the face of persistent monetary and fiscal policy uncertainty. While the Federal Reserve projects gross domestic product (GDP) growth of 1.4% for 2025 — reflecting a more cautious stance — unemployment has held steady at 4.2% and the recent easing of trade tensions with China has helped mitigate the most severe stagflationary risks. As a reminder, stagflation occurs when rising inflation and a stagnating economy occur at the same time, a hard-to-fight combination.
Still, despite lower severe stagflationary risks, inflation continues above the Fed’s 2% target, hovering near 3%. The Federal Reserve has maintained its policy rate at 4.25%-4.50% through June, but has signaled a more accommodative stance ahead. With two rate cuts anticipated this year, the central bank appears committed to supporting growth while managing inflationary pressures.
Following the sharp volatility in April, driven by tariff announcements, markets have rebounded impressively. Fueled by tech outperformance, the S&P 500 index rallied more than 24% from its April 8th bottom, finishing the first half of the year at an all-time high.
Looking ahead, economic activity should benefit from greater policy clarity and the prospect of fiscal stimulus from the One Big Beautiful Bill Act. While corporate earnings are set to post solid growth, particularly within the technology sector, trade anxieties could reestablish new headwinds.
How are Q2 Corporate Earnings Stacking Up?
The latest quarter presented a more challenging earnings environment for S&P 500 companies. Analysts are projecting the slowest earnings growth in two years amid widespread estimate revisions and heightened uncertainty around trade policies and economic conditions.
For Q2 2025, S&P 500 earnings are expected to grow 5.0% year-over-year, which would be the slowest pace since Q4 2023. This outlook dropped from an earlier estimate of 9.4% at the end of March, with all eleven sectors now projected to report lower earnings.
Among S&P 500 companies, 59 have issued negative earnings guidance, while 51 have issued positive guidance for the quarter. The index’s forward 12-month price-to-earnings (P/E) ratio stands at 21.9, above both its five- and ten-year averages. Higher P/E ratios can mean a company’s stock is overvalued or that higher growth is expected.
Despite earlier concerns, the technology sector’s earnings outlook has stabilized in recent weeks after initial downward revisions. The sector is expected to be a key driver of overall index performance, with analysts projecting approximately 21% earnings growth for the full year 2025. Major tech companies are benefiting from continued AI investment and infrastructure spending, though growth rates have moderated from previous quarters.
Economic Growth and GDP Outlook
The U.S. economy contracted in Q1 2025, with the final GDP estimate showing a 0.5% annualized decline. It was the first quarterly drop in three years, largely due to a surge in imports ahead of tariff hikes.
For Q2 2025, growth is expected to rebound to around 1.5% annualized, but this is a significant slowdown from previous years, with 3.2% growth in 2023, 2.5% growth in 2024.
The economy’s trajectory appears heavily dependent on tariff policies. Under the baseline scenario, real GDP growth is expected to be 1.4% in 2025 and 1.5% in 2026. The slowdown is due to weaker household and government spending, with consumption growth decelerating after an unsustainable surge in late 2024.
Manufacturing and Capital Spending Remain Sluggish
The manufacturing sector continues to contract. New orders weakened for the fifth straight month, while employment conditions deteriorated further. Increasing prices paid for inputs suggest that the tariffs on imported goods are hampering businesses’ ability to plan.
Business investment is also subdued, with capital expenditure expected to grow only 0.7% in 2025, down significantly from 3.7% in 2024. The Business Roundtable CEO Economic Outlook Index, which measures CEOs’ plans for hiring and capital spending, dropped 15 points to 69 in Q2 2025, well below its historic average of 83.
Productivity Is the Secret Sauce
Productivity is crucial for the economy because it is the main driver of long-term economic growth and rising living standards, enabling more (and better) goods and services to be produced with the same resources. Sustained productivity gains are essential for increasing GDP per capita and improving overall prosperity. U.S. productivity dipped 1.5% in Q1 2025, mainly due to higher labor costs and slower output growth.
Trade and Tariffs Headaches
The U.S. trade landscape in mid-2025 remains highly unsettled, with new tariffs and critical deadlines shaping economic and market conditions.
Currently, most imports face a 10% tariff, while Chinese goods are taxed at 30% after falling from a peak of 145%. Steel and aluminum imports carry a steep 50% tariff. These measures have triggered retaliation: China has imposed 10% tariffs on U.S. goods, and the EU is preparing renewed tariffs of up to 25% if talks fail.
In April, the U.S. trade deficit narrowed sharply to $61.6 billion as imports fell 16.3% and exports rose 3%. This reflected businesses rushing to bring in goods before tariffs increased and now adjusting their supply chains.
Negative Effects of Rising Costs
For 2025, tariffs and retaliation are expected to reduce real GDP growth by 0.5-0.6%, raise consumer prices by 1.5%, and increase unemployment by 0.3%.
The next three months will be critical. Several tariff pauses with the EU and other partners expire in July. The White House has signaled it may either extend negotiations or reinstate tariffs as high as 125% if talks collapse.
These decisions will have a direct impact on inflation, supply chains, and Federal Reserve policy. A breakthrough could ease tariffs and support lower inflation, paving the way for interest rate cuts. Renewed trade tensions could disrupt markets and delay monetary easing.
Staying Focused Amid Shifting Economic Currents
It’s been a wild quarter, with the major U.S. stock indices rebounding impressively from April lows.
Still, knotty issues continue to loom over the economy. These include ongoing trade policy dissonance, elevated expectations of inflation, and the increasing prospect of labor market softening.
While certain vital indicators are encouraging and point to economic resilience, the stagflationary mix of slowing growth, persistent inflation pressures, and policy uncertainty presents a challenging environment for both economic performance and financial market stability in the remainder of 2025.
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June saw markets improve as the inflation narrative shifted and trade policy zigged and zagged. Confronted with such a challenging assortment of factors, the Federal Reserve is remaining cautious. Read on for key highlights from last month.
Major U.S. Stock Indexes
U.S. stocks hit new highs last month as the financial markets returned to a risk-on stance. Both the S&P 500 and Nasdaq 100 finished June in record territory.
Federal Reserve Stays the Course
Inflation and Tariffs
Are Consumers Tiring?
Job Pressures Impact Confidence
Looking Ahead
The market’s rebound from April lows and recent global events is encouraging, but significant uncertainties remain. Most notable is the potential impact of the Middle East conflict on oil supplies from the Gulf, which holds half of global reserves and a third of production.
Amid tariff uncertainties and market volatility, it’s crucial to stay focused on your long-term goals. Investing success comes from thoughtful strategy, as opposed to market timing. Volatility is part of the process, and markets often – but not always – price in future risks well before they materialize.
If you’d like to discuss the current outlook or review your strategy based on recent developments, please reach out
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Last week brought a decision by the Fed on its key interest rate and no respite in the Israel-Iran conflict, making it an opportune time to share a quick rundown of what happened and highlight what’s ahead. Here’s a snapshot of what you should know.
Stock Index Performance
Federal Reserve & Interest Rates
Israel-Iran Conflict
Home Builder Sentiment & Retail Sales
The Week Ahead
That’s it for this week’s update! If you’d like to explore any of these topics further or have other questions as the week unfolds, don’t hesitate to reach out.
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Last week brought softer inflation data than expected, news of a U.S.-China trade deal, and an Israel-Iran conflict that unnerved the market. With so many developments last week, read on for a bite-sized summary of what you should know.
Weekly Stock Index Performance
Fueled by continued tariff concerns and geopolitical fears amid attacks between Israel and Iran, all three major indexes fell last week, with the Dow slipping back into negative territory for the year.
Inflation Data
Prices at the Pump to Rise?
U.S.-China Trade Deal
The Week Ahead: Fed Meeting
That’s it for this week’s update! If you’d like to explore any of these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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Last week brought the extension of a market rally and slightly stronger-than-expected jobs data, albeit with some indications of labor market cooling. Read on for a bite-sized summary of what you need to know.
Weekly Stock Index Performance
Major Indexes Extend Rally
Jobs Data Strong With Signs of Cooling
Federal Reserve Considerations
The Week Ahead
That’s it for this week’s update! If you’d like to explore any of these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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Last month brought us surging stocks fueled in part by progress on trade with the United Kingdom and China and inflation metrics released during the month following a similar relaxing pattern as the previous month.
It has been a volatile two months, with swings in both directions, making it an opportune time to share an overview of what happened and what could be ahead. Read on for a monthly summary of what you should know.
Major U.S. Stock Indexes
It was bulls on parade during May on Wall Street, courtesy of tariff relief hopes. The S&P 500 had its best month of May in 30 years.
Here’s how major U.S. stock indexes fared in May:
Inflation Relaxation
Inflation metrics showed more signs of relaxing in May, much like in April, even though many consumers expect it to rise due to tariffs.
Consumer Price Index (CPI)
Core PCE
Putting together the inflation metrics released in May, one could surmise a continuation of last month’s cooling narrative, while the full future impact of tariffs is yet to be known.
Fed Meeting
Labor Market
The Consumer: Pensive, Waiting
April Showers Gave Us May Flowers
If you would like to discuss the current market outlook and explore investment strategies based on your objectives or market developments, please feel free to contact us.
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Links to third-party websites are for general information purposes only and do not constitute any offer or solicitation to buy or sell any services or products of any kind. The other parties are responsible for the content on their website(s). You are encouraged to read and evaluate the privacy and security policies on the specific site you are entering. They are not intended and should not be relied upon as investment, insurance, financial, tax, or legal advice.
Last week brought higher government bond yields following House approval of a new budget bill, as well as firmer gold and Bitcoin pricing. Read on for a bite-sized summary of what you should know.
Weekly Stock Index Performance
Budget Bill / Bond Yields
Bitcoin, Gold Rise
Existing Home Sales Decline
The Week Ahead
That’s it for this week’s update! If you’d like to explore any of these topics further or have any other questions or needs as the week unfolds, don’t hesitate to reach out.
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Did Something in This Update Spark Your Interest?
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Links to third-party websites are for general information purposes only and do not constitute any offer or solicitation to buy or sell any services or products of any kind. The other parties are responsible for the content on their website(s). You are encouraged to read and evaluate the privacy and security policies on the specific site you are entering. They are not intended and should not be relied upon as investment, insurance, financial, tax, or legal advice.
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