Market Outlook and Positioning
June 2025
The expectation of fewer rate cuts and trade-policy uncertainty defined a volatile first half of the year. Recently, sentiment improved on the prospect of government agreements with its main partners.
Key Market Highlights:
- Market Performance:
The S&P 500 and Nasdaq have reversed their April declines and now show year-to-date gains of approximately 3% and 2%, respectively.
- Monetary Policy & Valuation:
The Fed has held rates steady, reiterating that there’s no rush to resume cuts. The S&P 500’s forward P/E remains elevated at roughly 23×, versus a long-term average of 17×.
- Strategy & Positioning:
While the corporate backdrop could improve over the coming years, we have adjusted our tactical stance from positive to neutral on Large-Cap equities.
Upcoming Events to Watch:
- Trade and fiscal policies under the new Trump administration
- Employment data releases and the potential timing of any rate cuts
