July 2025 KWP Newsletter
Guided Outlook
Years ago, a sailor shared why he trusted the old lighthouse on the rocky coast. It didn’t move to meet the ship, but rather it stayed in place, shining steadily through fog, wind, and storms. Success depended on aiming for that guiding light.
In investing, consistency is our lighthouse. Markets shift, headlines swirl, and the waters can get choppy. But staying true to a clear plan; adjusting as needed, but not overreacting, keeps us off the rocks. June and July brought their share of crosscurrents, but for those who stayed focused, the view ahead remains promising. With the news of renewed tariffs, shifting expectations around interest rates, and geopolitical tensions there were plenty of headlines. Yet through it all, markets reached new highs, rewarding those who hold the course.
Market Themes from June and July
The past few months have given us plenty to think about. U.S. stock indexes climbed to new highs during June, reflecting optimism around cooling inflation and the possibility of interest rate cuts later this year. At the same time, markets reacted cautiously to the risk of renewed tariffs, as a 90-day pause in trade tensions approached its deadline in July. While there is hope for an extension, any escalation could lead to renewed volatility.
In addition, the labor market has continued to show resilience, with steady hiring and a slight drop in the unemployment rate. This strong employment backdrop has given the Federal Reserve reason to wait and watch before moving on rate cuts. Inflation has cooled somewhat but remains just above target levels, supporting the Fed’s cautious approach.
Internationally, markets have also been supported by a weaker U.S. dollar, which has boosted returns for U.S.-based investors holding foreign equities. But global trade risks and geopolitical tensions—from Middle East conflicts to policy uncertainty in Europe and Asia—remain important factors to watch.
Bond markets, meanwhile, have stabilized somewhat, with investors benefiting from higher yields despite a backdrop of cautious central bank policy.
Looking Ahead to the Rest of 2025
As we move through summer and into the second half of the year, there are several important topics worth monitoring:
• Trade policy decisions could either support continued economic growth or introduce new headwinds. • The Federal Reserve’s path on interest rates will depend on incoming data, with markets currently expecting the first rate cut in late summer or fall. • Corporate earnings—particularly in technology and healthcare—will remain a key driver of sentiment. • Geopolitical risks could lead to periods of market volatility, underscoring the need for diversification. • Differences in economic growth between regions may shape opportunities and risks globally.
As your advisor, our goal is to help you keep sight of that steady light, no matter how noisy or uncertain the environment becomes. That way, together, we can navigate confidently toward your long-term goals—even when the weather doesn’t cooperate.
When we build financial plans, we’re not trying to predict every squall or dodge every wave. Instead, we set clear goals and strategies—our own lighthouses. We revisit them regularly, making sure they’re still pointing where we want to go. But we avoid the temptation to panic and change direction every time the fog rolls in.
Wall Street Journal: “Steady Hiring Added 147,000 Jobs to U.S. Economy in June” https://www.wsj.com/economy/jobs-report-june-2025-unemployment
Reuters: “Investors Eye Tariff Deadline as US Stocks Rally” https://www.reuters.com/business/wall-st-week-ahead-investors-eye-tariff-deadline
Investors Business Daily: “What Will Markets Bring in the Last Half of 2025?” https://www.investors.com/news/stock-market-forecast-next-six-months-risks
**Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Kotys Wealth Professionals (“KWP”), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from KWP. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. KWP is neither a law firm, nor a certified public accounting firm, and no portion of the newsletter content should be construed as legal or accounting advice. A copy of KWP’s current written disclosure Brochure discussing our advisory services and fees is available upon request. Please Note: If you are a KWP client, please remember to contact KWP, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. KWP shall continue to rely on the accuracy of information that you have provided or at www.kotyswealthpro.com. Please Note: IF you are a KWP client, Please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.