June Market Recap
As crazy as it may seem to read (or write), US stocks finished June at all-time highs.
Despite a 20% selloff from mid-February to early April… Despite the tariff uncertainty brought on by a new administration… Despite negative GDP growth and missile strikes in the Middle East… The stock market endured and ended the first half of 2025 higher than it has ever been.
The Dow Jones, S&P 500, NASDAQ and Russell 2000 benchmarks all gained more than 4% in June, underscoring the breadth of a remarkably rapid recovery. The S&P has rebounded more than 28% since its April low. In terms of 12-week performance, this has been one of the 10 best stretches for the S&P 500 in the last 40 years.
With a bullish mentality again taking hold, we are back to the familiar theme of tech stocks leading the charge. Technology (+9.7%) was the best-performing sector for the third consecutive month. Communication Services (+7.2%) – nearly half of which is Meta and Alphabet – also delivered big profits last month. Consumer Staples (-2.2%) and Real Estate (-0.5%) were the only two sectors to finish negative.
Benchmark Returns: June 2025 | YTD 2025
|
Dow Jones
|
S&P 500
|
NASDAQ
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+4.32% | +3.64%
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+4.96% | +5.50%
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+6.57% | +5.48%
|
|---|
In some ways, an absence of major events cleared the runway for stocks to build on the momentum created in April and May. Second-quarter earnings reports are still weeks away and Q2 GDP numbers will not be released until late July.
The Federal Reserve’s Board of Governors did convene for another meeting in June but nothing much came from it. The Fed (again) made no changes to interest rates, the fourth straight meeting that resulted in no policy changes. Forecasts and dot-plots suggest two 0.25% cuts are coming before year-end. For now, the Fed Funds Rate remains at 4.25% – 4.50%, same as it has since December 2024.
Lower interest rates would certainly be favored by President Trump, who stated that preference publicly on several occasions in June. Trump’s “big beautiful bill,” likely to be signed into law in July, will bring tax cuts but add an estimated $3-4 trillion to the federal government’s deficit. The cost to finance that debt would obviously be lower if interest rates declined.
A reminder that a 90-day pause to Trump’s reciprocal tariffs was the catalyst that triggered this stock market recovery. That pause is scheduled to expire on July 9 and while Trump says he is not planning any extensions, financial markets are behaving like those tariffs are gone for good. Reports suggest the US has held trade negotiations with Europe and China but no formal trade deals have been reached with foreign countries since the US-UK agreement in early May.
The biggest potential obstacle to market gains last month came after the Israeli military attacked several nuclear facilities in Iran. The US military followed with additional missile strikes in Iran but financial markets barely noticed. Crude oil prices briefly spiked to their highest level since January before subsiding.
International stocks continued to grind higher. Non-US Developed Markets increased 2.4% in June and have gained more than 20% year-to-date. Emerging Market equities were up 7% last month and have climbed 16% this year. Small cap stocks, as measured by the Russell 2000, were up 5.3%.
Bond yields continued to move lower. Ten-year US Treasury yields ended June at 4.25%, down from 4.42% a month earlier. The move reflects generally low inflation. The Consumer Price Index (CPI) increased 0.1% in May (lower than consensus expectations) and the most recent year-over-year CPI came in at 2.4%, near a 4-year low.
Ben Marks
Chief Investment Officer
Brett Angel
Senior Wealth Advisor
Investment Advice offered through Marks Group Wealth Management, a Registered Investment Advisor.
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The Standard & Poor’s 500 Index is a capitalization weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index.
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Russell 1000 Growth Index measures the performance of those Russell 1000 companies with higher price to-book ratios and higher forecasted growth values.
Russell 1000 Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.
The Russell 2000 Index is an unmanaged index generally representative of the 2,000 smallest companies in the Russell Index, which represents approximately 10% of the total market capitalization of the Russell 3000 Index.
MSCI EAFE Index consists of the following developed market country indices: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom.
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