1) MARKET BAROMETER
July wrapped up with a cautiously optimistic tone across global markets, as investors balanced strong returns with mixed signals from central banks and a complex macro backdrop. Let’s be frank: between real conflicts, growing tensions,
and tariff wars, the overall geopolitical outlook is far from positive!
Still, equities continued their rally. The S&P 500 gained ~2.2% in July, now up ~17% year-to-date, while the Nasdaq surged ~3.7%, pushing its YTD gains to ~26%, led by AI-fueled tech earnings.
Emerging markets are also holding strong, with ~17% YTD
returns, particularly from China and Brazil—though a strengthening U.S. dollar and renewed trade tensions could weigh on momentum.
Bond markets were steady but supported, with the Bloomberg U.S. Aggregate Bond Index up ~1.5% in July and ~3.6% YTD, thanks to a slight drop in Treasury yields. Investors returned to high-grade bonds amid stable inflation data and cautious optimism around the future path of interest
rates.
Real estate stayed subdued. While global REITs are up ~5–6% YTD, high borrowing costs and refinancing pressures—especially in commercial property—are weighing on sentiment. Residential markets in some regions are seeing renewed foreign investor interest, particularly in the U.S.
Private equity deal activity remained relatively quiet,
though M&A volumes rose ~20% YoY in H1 2025, with many deals financed through equity rather than debt. Investors are becoming more selective, favoring sectors with visible cash flow and AI-driven disruption.
Crypto markets experienced a notable rebound in July. Bitcoin climbed ~13%, stabilizing in the $115K–118K range by month’s end, buoyed by ETF inflows and growing institutional confidence. The passage of the
GENIUS Act in the U.S. on July 18 brought long-awaited regulatory clarity to stablecoins, fueling renewed optimism. However, altcoins delivered mixed results—XRP stood out, boosted by legal clarity and ETF tailwinds. Yet broader upside was still capped by persistent regulatory ambiguity in both the U.S. and Europe, especially around altcoin classification and fund eligibility.
So, what happened in the markets in July? And more
importantly, was there any reason to do more than simply stay the course?
The short answer: no major shifts, but important signals. Markets are rallying, but not without friction—equity valuations remain elevated, credit spreads are tight, and geopolitical instability continues to simmer in the background. It’s a climate where short-term exuberance could mask structural
fragility.
As such, I continue to rely on a long-term horizon, conservative diversification, and a solid liquidity buffer—my war chest and emergency fund to navigate any sudden corrections or prolonged bear phases. Because while momentum can be tempting, discipline is still the most valuable asset in a portfolio.
