Weekly Market Bullets

for the week ending 8/1/2025

• US Equity Markets sold off last week as Trump announced new tariffs, the Fed kept interest rates unchanged, and economic data softened. The S&P 500 dropped 2.4% for the week and is now up 6.1% for the year. The Nasdaq fell 2.2% for the week to bring its gains for the year to 6.9%, while the Russell 2000 (small cap stocks) tumbled 4.2% for the week and is now down 2.8% for the year.

• Global Equity Markets dropped last week despite a US-European Union trade deal and further trade talks between the US and China. Developed Markets were down 3.0% for the week and are now up 15.1% for the year. Emerging Markets fell 2.5% for the week and are now up 14.0% for the year.

• The Fed held rates steady, but weak economic data after its meeting likely means a rate cut is coming. The Fed chose not to lower interest rates at its meeting last week, but Payroll data for July missed expectations, suggesting some weakening in the labor market. Payroll gains came in at 73K, well below consensus, while June Payroll gains were revised meaningfully lower. The Unemployment Rate ticked up to 4.2% from 4.1% in June. As a result, the yield on the US 10-Year Treasury dropped to 4.21% from 4.39% the prior week. There is now an 80% probability that the Fed cuts rates at its next meeting in September.

• New tariff announcements actually result in a small decline in overall tariffs. While individual countries faced jumps in their tariff rates, others saw rates come down. For instance, Switzerland got hit with a 39% rate, more than double the EU's rate of 15% based on its recent trade agreement, likely leading to a deal. On the other hand, Thailand and Cambodia saw their rates drop to 19% from 36%. On balance, total annual tariffs are now estimated at $360-370 billion, down slightly from $370-380 billion.

Market Data

for the week ending 8/1/2025