Weekly Market Recap: Week of July 7, 2025

The week in review

• Svcs. and mfg. PMI improved to 50.8 and 49, respectively
• JOLTS openings rose to 7,769mm
• Nonfarm payrolls rose by 147k

The week ahead

• FOMC minutes
• NFIB small business index

Thought of the Week

While it was a very volatile first half of the year from both a fundamental and market perspective, investors can draw two valuable lessons: the importance of diversifying and staying invested for the long term.

Globally diversified investors profited, with international equities dramatically outperforming their U.S. counterparts by over 1,200 bps. Part of this outperformance was due to a falling U.S. dollar, with the greenback ending the first half down 10.7%. The benefits of diversification were also evident in fixed income, which generated solid returns and, as importantly, provided stability when risk assets were down. Commodities achieved steady returns despite geopolitical challenges. Cash returned 2.1%, which, while positive, serves as a further reminder that taking a “wait and see approach” does not achieve the best long-term results.

However, the first half of 2025 also reminded investors of the importance of staying invested and not trying to time the market. As shown in this week’s chart of the week, U.S. stocks saw major drawdowns within the first half, with large caps declining 18.9% and small caps falling 24.5%. But, by the end of the first half, large caps had rebounded and small caps were only slightly down. Investors who stayed diversified and stayed invested fared the best in the first half of 2025.

On average, valuations ended 2025 higher, but broad areas of global financial markets still seem reasonably priced. As we move into the second half of the year investors should focus on diversification and portfolio rebalancing, and take advantage of the resilience provided by alternative asset classes.

Chart of the Week: Source: Bloomberg, FactSet, MSCI, NAREIT, FTSE
Russell, Standard & Poor’s, J.P. Morgan Asset Management. Returns
shown are total return as of June 30, 2025 unless stated otherwise.
*Maximum drawdown for equities calculated using price return and
reflects largest peak to trough drawdown during the year.
Thought of the week: Source: Bloomberg, FactSet, MSCI, NAREIT, FTSE
Russell, Standard & Poor’s, J.P. Morgan Asset Management.

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Originally Posted July 7, 2025 – Weekly Market Recap

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