The last few months have been a bit of a rollercoaster! Markets went up, then down, then back up again. But here’s the good news, this is exactly why having a mix of different investments matters so much. When markets get bumpy, the best thing you can do is take a deep breath and stick to your plan rather than making rushed decisions.
What’s been happening around the world?
United States
American share markets kept climbing despite lots of policy changes. The S&P 500 had its best month since November 2023, jumping 6.3% in June alone. Tech companies led the charge, though healthcare stocks didn’t do as well.
Bonds had a tougher time after the US credit rating was downgraded in May due to worries about government debt. The Federal Reserve kept interest rates at 4.25-4.50%, saying the economy looks okay but watching out for inflation and job losses.
Europe
Things looked brighter in Europe this quarter. Businesses felt more confident, especially in Germany, and the European Central Bank cut interest rates twice. That helped lift markets in both Europe and the UK.
Emerging markets
Developing countries also had a strong quarter. Eastern Europe and China did particularly well, boosted by positive economic news and excitement about artificial intelligence. Brazil and South Africa also saw gains, while India didn’t perform as strongly.
Some of the big stories
Trade talks
Trade policy was the hot topic. The US hit pause on several tariffs for 90 days, which calmed nerves and sparked optimism about better trade deals with the UK and lower tariffs with China. That said, people are still watching carefully for signs of a bigger trade war.
Economic updates
The US economy started 2025 in good shape, with tariffs having less impact than expected. But rising prices and falling confidence among businesses and consumers are concerns. A new tax bill extending previous tax cuts has people worried about growing national debt.
Here in New Zealand, unemployment held steady at 5.1% in the first quarter, but wages didn’t grow as much as hoped. The Reserve Bank dropped interest rates, and more cuts might be coming. The Government’s Budget outlined a plan to balance the books by June 2029.
May’s recovery
Markets bounced back nicely in May after a rough April. The S&P 500 jumped 19% from its lowest point and almost hit record highs again. Better-than-expected company earnings and positive trade news helped fuel this comeback.
What we’re keeping an eye on
Markets will likely stay sensitive to trade policy news and economic data in the coming months. Global politics and policy changes will keep things interesting. Our advice? Stay informed, but don’t let every headline make you change course.
Going forward
It’s been an eventful quarter with plenty of ups and downs. But remember, keeping a long-term view and staying diversified helps you weather the storms and reach your financial goals. Trust in your strategy and in the market’s ability to bounce back over time. And as always, your Cole Murray Financial Adviser is just a phone call away.
