July 2025 Market Commentary: A Tale of Two Quarters

The first half of 2025 delivered two dramatically different quarters in the equity markets. A sharp downturn early in the year gave way to a powerful rebound, particularly among the “Magnificent 7” tech stocks. While headline indices posted modest year-to-date gains, a deeper look reveals a market defined by volatility, geopolitical unease, and alternating waves of investor anxiety and relief. Market sentiment shifted as fears over tariffs, inflation, and global conflict eased—if only temporarily—prompting a late surge fueled by improving technical indicators and cooling inflation data.

Yet despite the second quarter rally, the path forward remains unclear. Slowing job growth, weakening earnings forecasts, elevated stock valuations, and fiscal uncertainty present ongoing headwinds. With the corporate earnings season set to begin, many companies, especially in the healthcare sector, are struggling to provide clear guidance amid these crosscurrents.

So, after last year’s big gains, and this year’s more modest gains, you may want to revisit your asset allocation and bring it to a level you are comfortable with. As always, we are here to help.

Market Commentary and review provided by Peter W. Tuz, CFA, CFP®, President & Director, Portfolio Manager, Chase Investment Counsel.

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