Mid-Year Markets & Economic Update (Monthly Market Update - June 2025)

Navigating Opportunity Amid Uncertainty

Mid-year Markets & Economic Update (MMU June 2025)Olivia Countiss, Financial Advisor | CEPA, AAMS

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Countiss Wealth Management (CWM) - Monthly Market Update (MMU) - June 2025 - https://www.youtube.com/watch?v=4JgQxnK1hno

Summary

Markets surged in Q2, led by mega-cap tech. International and high-yield bonds outperformed, while inflation moderated and the Fed turned dovish. A “cold, hot, cold” growth pattern may emerge. Investors are urged to stay diversified, review bonds, and stay focused on long-term goals.

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The first half of 2025 reminded investors that while headlines feel urgent, the most important decisions require patience and perspective.

Technology stocks powered the second-quarter rally, with the S&P 500 gaining nearly 11%. The “Magnificent Seven,” led by NVIDIA, showed standout performance, while energy and real estate lagged behind.

Equity markets staged a powerful, but narrow, rally. The S&P 500 gained 11% in the second quarter alone, driven by mega-cap technology leaders like NVIDIA, Microsoft, and Meta. In contrast, value stocks and small caps lagged.

The U.S. dollar declined in Q2, helping boost international stock performance. This chart tracks the dollar’s strength over time against major global currencies and marks key historical turning points.

International stocks outperformed the U.S. for the second straight quarter, boosted by a weaker dollar. Bonds also advanced, as Treasury yields eased and credit spreads stayed tight. High-yield bonds gained over 3% in the quarter.

Gold surged above $3,000 an ounce—an all-time high—as investors sought safe havens amid geopolitical tensions and policy uncertainty. The chart highlights major historical peaks.

Meanwhile, gold surged above $3,000 an ounce amid geopolitical tensions, while real estate equities lagged despite tight supply and inflation-linked leases. 

Job growth is cooling, averaging about 124,000 new jobs per month. This long-term chart shows monthly payroll gains and losses, illustrating the recent slowdown in hiring across the U.S. economy.

Under the surface, the economic backdrop is cooling.

Consumer spending softened, housing activity slowed, and job growth decelerated to around 124,000 new jobs per month. Yet inflation has moderated, with the Fed’s preferred measure holding near 2.3%.

Tariffs remain a key wildcard, with revenue surging to $27 billion in June and likely to push inflation higher in the second half of the year. 

The Federal Reserve continues to walk a tightrope between supporting employment and managing inflation. This visual underscores the tension between the two as the Fed considers future rate moves.

The Federal Reserve has pivoted to a more dovish stance, signaling possible rate cuts later this year if growth continues to slow. At the same time, Congress is advancing a sweeping fiscal package combining tax cuts with expanded tariffs—setting the stage for what some analysts call a “cold, hot, cold” cycle of growth and inflation.  

Diversification remains a core strategy. This stylized chart depicts a balanced allocation across stocks, bonds, real assets, and alternative investments to help manage risk and capture opportunity.

So, what should investors do? 

Three key investment principles to remember in today’s market: stay diversified, reassess your bond allocations as yields improve, and always align your portfolio with your long-term goals.

• Stay diversified. Don’t chase the winners or wait endlessly for the perfect entry point. 

• Review bond allocations, as yields are now far more attractive. Consider real assets and alternatives to hedge volatility. 

• Most importantly, align your portfolio with your long-term goals and risk tolerance. 

The bottom line? 

2025 has shown that the most important actions are often the least urgent. Staying invested, diversified, and patient remains the surest path to achieving long-term financial goals. --

Countiss Wealth Management offers trusted financial guidance tailored to your unique goals. Our Monthly Market Updates help you stay informed on key economic trends, market volatility, and investment strategies. As a father/daughter advisor duo based in Flowood, Mississippi, we believe in the power of diversification, long-term planning, and personalized service. Let us help you build confidence in your financial future—no matter what the market brings.