Market Summary 2Q–2025

"Ryan Bouchard, CFA, CFP®, CEPA, AIF®" |
Categories
Quarterly Market Commentary
Economic Outlook
Investing
Stocks
Investment Strategy

Navigating Opportunity Amid Uncertainty

The S&P 500 jumped 11% in the second quarter of 2025, with mega-cap tech stocks once again driving returns. Nvidia climbed +46%, Microsoft +33%, and Meta +28%, underscoring the persistent concentration of market leadership. Meanwhile, value stocks and small-caps lagged, leaving market breadth relatively narrow despite record highs.

International equities outperformed U.S. stocks for the second consecutive quarter, helped by a softer dollar in both developed and emerging markets.

Bond markets rallied as Treasury yields retreated from recent highs, supporting positive total returns across credit sectors.

Economic signals were more mixed. Consumer spending softened, job creation slowed, and housing activity remained under pressure from elevated mortgage rates. Inflation eased closer to target but stayed stubborn in shelter and services. The Fed held rates steady in June but hinted at possible cuts later this year, while Congress advanced a sweeping fiscal package combining tax cuts and higher tariffs.

  • What is the source of international market strength?
  • Where are we in the inflation fight, and what does a cooling economy mean for the back half of 2025?
  • How should investors position themselves for the rest of the year?

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