Mid-Year Market Update: Resilience, Recovery, and What Comes Next
A Letter from our founder, Katrina C. Lessard, CFP®, AEP® | Lessard Wealth Management
As Americans fire up their grills and plan beach getaways for the July 4th holiday, both the stock market and the summer weather have been heating up. The first half of 2025 has brought a mix of volatility and optimism—but if there’s one theme that stands out, it’s resilience.
Independence Day is a great reminder that resilience and perseverance are woven into the fabric of our country. Those same values are what keep our markets and economy moving forward.
Despite facing a dynamic and often unpredictable environment shaped by global tensions, shifting trade agreements, and a wave of fiscal reforms, markets have shown surprising strength. In fact, the S&P 500 wrapped up June at a new record high, fully recovering from its April dip in just over four months—one of the fastest rebounds from a 10–20% correction in market history.
What’s Driving the Rally?
Several key forces have supported the recovery:
- Trade Progress: Multiple new tariff agreements have bolstered American industry without triggering the kind of inflationary pressures many feared. This includes high-impact negotiations with Vietnam, the UK, and China.
- Cease-Fire in the Middle East: The de-escalation between Israel and Iran helped push oil prices lower and gave the bond market some breathing room, contributing to lower interest rates.
- Stimulus Expectations: The proposed tax cut and spending bill—part of the broader economic package from the current administration—has reinforced confidence in consumer strength and corporate earnings.
- AI Momentum: Renewed demand and institutional buying in artificial intelligence and tech sectors have added fuel to the equity rally.
- Fed Outlook: Investors are beginning to price in a likely return to Federal Reserve rate cuts later this year, which could support risk assets moving forward.
What Comes Next?
While market history suggests that new highs often lead to continued momentum, it’s important to stay grounded. Valuations are elevated, and earnings will be critical to driving further upside. Geopolitical flare-ups, policy uncertainty, and inflation data all remain potential headwinds.
At Lessard Wealth Management, we remain focused on what we can control: a disciplined approach to planning, investing, and adapting as needed. We’re keeping a close watch on:
- Consumer trends
- Labor market data
- Corporate earnings
- Fed guidance
- Tax policy developments
- Technical signals for risk and opportunity
What Should You Do Now?
For most long-term investors, staying invested, staying diversified, and being prepared to act on opportunity is the most prudent path forward. You don’t need to time the market—you need to stay aligned with your plan.
We are watching the data closely and if anything requires action ahead of your next scheduled review, we’ll be in touch. Otherwise, I look forward to catching up during our next meeting. As always, if you have any questions in the meantime, don’t hesitate to reach out.
Wishing you and your family a safe, joyful, and meaningful 4th of July. 🇺🇸
Sincerely,
Katrina C. Lessard, CFP®, AEP®
Founder, Lessard Wealth Management