Weekly Market Update for July 3, 2025
The major indices are back to all-time highs, surpassing their prior mid-February peaks. It was difficult to see such a possibility just a few months ago. The rebound has been swift and vast from the early-April lows, as tariffs have been toned down and as Congress has gained traction on their big fiscal bill. The S&P 500 finished the week +1.7%, the month of June +5.0%, and the second quarter (Q2) +10.6%. The Nasdaq finished the week +1.6%, June +6.6%, and Q2 +17.7%. The 10-Year Treasury yield, an interest rate indicator, closed at 4.34%, up +3 bps from last week, but down -20 bps from the start of the year.
The government’s large reconciliation bill passed the Senate on Tuesday and looks poised to pass the House later today. The bill is packed with changes to both tax revenues (partly via extension of 2017 TCJA cuts) and government spending. Net-net, it keeps fiscal deficits in place as well as adding to the national debt. The impact on GDP growth and inflation will continue to be debated amongst investors.
On the trade front, progress was made towards deals with a number of countries, including Canada, the EU region, Vietnam, and China. Next week the pause on many reciprocal tariffs is set to expire on July 9th, but the administration has suggested there may be a willingness to extend with those countries in which deal progress is being made. On the economic front, most manufacturing readings this week were in-line to a touch below expectations. May job openings (JOLTS) were a little better, rising to 7.77 million. Then on Thursday the June employment report was more robust than forecast. The economy added 147,000 jobs, particularly within education and health services as well as in state and local government.
Markets, and our offices, will be closed this afternoon and tomorrow in observance of the Independence Day holiday. Next week should be rather quiet. The NFIB Small Business Index will be released Tuesday and Delta Airlines will report their Q2 results on Thursday. Earnings season won’t ramp up materially, though, until the big banks start reporting the following week.
We wish you a safe & enjoyable July 4th weekend!
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