Market review – July 2025

Please see our glossary for terms used throughout the article.

July saw continued positive momentum within equity markets, but weakness in bond markets. The US dollar staged an impressive rebound in the month, as tariff announcements and trade deals continued to dominate headlines.

Global equity markets posted strong gains in July, driven by a resurgent US, as the second quarter company earnings season got off to a solid start. The NASDAQ led the charge, buoyed by strong performances from some of the technology giants, while the S&P 500 also advanced, marking its third consecutive monthly gain. Elsewhere, equity indices in the UK, Southern Europe, Japan and China posted gains.

In fixed income (bonds), developed market government bonds came under pressure in July. In the US, decent economic data, persistent inflation pressures (the US Federal Reserve’s preferred core PCE (Personal Consumption Expenditures) release for June came in at +0.3% month-on-month), and a hawkish tone from the Federal Reserve (Fed), put pressure on yields. The Fed, European Central Bank and Bank of England all held rates steady in July.

The US dollar staged an impressive rebound in July, reversing part of its decline in the first half of 2025. This strength was underpinned by solid US economic and corporate data and reduced expectations for Fed rate cuts. In commodity markets, oil prices rallied against the more positive growth backdrop.
 

The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. We are unable to give financial advice. If you are unsure about the suitability of your investment, speak to your financial adviser. The views expressed in this article should not be taken as a recommendation, advice or forecast. Past performance is not a guide to future performance.