July 2025 Market Commentary
MSB Wealth - Aug 06, 2025
July closed with the S&P 500 at 6,339 and the TSX at 27,218, both hitting fresh all-time highs. Trade deals are rolling in, corporate earnings are beating expectations, and even central banks are holding steady.
July 2025 delivered a masterclass in turning market cacophony into fresh record highs. The S&P 500 closed at 6,339.39 on July 31, slightly down from an all-time high of 6,389.77 on July 28, 2025, and the S&P/TSX Composite ended the day at 27,218.61, also lower than a previous intra day high of 27,539.88 on July 29, 2025. Despite late‑month pullbacks—S&P slipped ~0.4%—markets gained across July, buoyed by upbeat corporate earnings, improving economic sentiment, and every new trade deal announcement from the U.S. gaining cheers as investor wins.
On the economic front, U.S. consumer confidence ticked up to 97.2 in July, and the expectations index rose to 74.4, signaling easing inflation fears and greater optimism going forward. Inflation continues to cool. Headline U.S. CPI decelerated, and producer prices fell in June, notably with a dramatic 21.8% drop in chicken egg prices—the kind of relief messaging the Fed probably didn’t anticipate. Meanwhile, in Canada the BoC held its rate steady at 2.75% for a third meet, citing a delicate mix of slowing growth, trade uncertainty, and baseline inflation near 2%.
Firm earnings from U.S. mega‑caps—think Meta, Microsoft, Apple and Goldman—drove much of the optimism as tech and financial sectors reported earnings growth of 41% and 12.8% respectively, despite margin pressures from tariffs. Meanwhile, investor sentiment flipped from “stagflation panic” at the start of 2025 to “bull-market euphoria,” as recession fears faded, corporate profits surprised to the upside, and rising optimism around trade policy lifted confidence across equity strategists.
Through the noise, MSB Wealth remains dialed in. We’ve reinstated our year‑end targets: TSX 28,500 and S&P 6,700, reflecting healthier momentum and improved clarity around tariffs and global trade deals. With both the Fed and BoC holding rates (U.S. left unchanged at 4.25%–4.50%, Canada at 2.75%) and inflation signals easing, clarity is slowly replacing uncertainty. Our counsel? Enjoy the rose-colored forecasts—but stay diversified, stay disciplined, and base your decisions on fundamentals, not headlines. After all, calm is an investor’s secret edge.
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