Clarity Wealth Limited | Market Commentary
📰 Why This Matters
In recent weeks, financial markets have continued to move, but coverage in mainstream news outlets has noticeably decreased. I think we can all agree that the media prefer to concentrate on negativity!
In the interest of balance and transparency, we’ve prepared a short summary of global market activity over the past month, highlighting key developments that may be relevant to long-term investors.
📈 Market Performance – Equity Gains Continue
Over the last four weeks (mid-June to early July 2025), equity markets have delivered strong returns:
- S&P 500 (US): Up approximately 6.2%, supported by resilient economic data and continued strength in the technology sector.
- Nasdaq Composite (US): Gained approximately 6.7%, fuelled by large-cap growth and artificial intelligence themes.
- FTSE 100 (UK): Up around 1.8%, with gains driven by energy, financials, and easing concerns over trade disruption.
- Euro Stoxx 50 (Europe): Rose approximately 2.5%, reflecting modest economic optimism and falling inflation.
Source: Bloomberg, 3 July 2025. Performance in local currency terms. Index returns do not include dividends.
🌍 Key Drivers
Trade & Policy Uncertainty
Markets are watching the upcoming 9 July deadline for potential changes to international tariff arrangements. While some agreements are being renegotiated, uncertainty remains, which has contributed to short-term volatility and some reallocation across asset classes.
Economic Data
- Employment: US labour market data remains positive, supporting equity valuations.
- Manufacturing: Indicators such as the US ISM Index continue to show contraction, highlighting sector-specific challenges.
- UK Business Sentiment: Most UK companies report limited direct impact from global tariffs, though some expect reduced investment or demand going forward.
Central Banks
Major central banks, including the Federal Reserve and Bank of England, have adopted a more cautious tone in recent weeks. While inflation continues to ease, policymakers are weighing the risks of trade disruption before adjusting interest rates further.
📉 Other Asset Classes
- Gold has continued to perform well, reflecting its traditional role as a safe-haven asset amid global uncertainty.
- The US dollar has weakened slightly, supporting demand for non-USD assets.
- Bond markets have remained stable, with yields reflecting expectations of a slower pace of policy easing.
🔎 Summary Table
| Area | Summary Insight |
|---|---|
| Equities | Broad-based gains across US, UK and European indices |
| Economic Outlook | Employment strong; manufacturing mixed |
| Policy Watch | Central banks cautious; inflation slowing |
| Trade Risk | Tariff deadline on 9 July remains a key market focus |
| Asset Allocation | Some movement toward defensives (gold, bonds, quality equities) |
🧠 What This Means for You
At Clarity Wealth Limited, we help clients focus on long-term planning, rather than short-term headlines. While recent equity market returns have been positive, we remain mindful of the risks posed by global trade policies, interest rate uncertainty, and shifting investor sentiment.
If you’re unsure how current market conditions might impact your financial goals or investment strategy, please speak to your adviser. We continue to review client portfolios regularly to ensure they remain aligned with your long-term objectives and tolerance for risk. Please remember everything we do is based on your INDIVIDUAL circumstances so what is right for someone else may not be right for you!
Important Information
This communication is for information purposes only and does not constitute financial advice. The value of investments can go down as well as up, and you may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. Please seek personalised advice before taking any action based on the content of this update.
Clarity Wealth Limited is authorised and regulated by the Financial Conduct Authority. If you have any questions about your financial plan, portfolio, or recent market movements, please get in touch with your adviser.
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