The Market Down & Dirty

August 25th 2025

The Data

Equities were weak for most of the week before Friday which saw markets soar higher.

• S&P 500 +0.29% Dow +1.53% Russell 2000 +3.39%, Nasdaq -0.58%.[1]

• The All-Country World Index gained +0.51%.1

S&P 500 sub-sectors were mostly higher last week.

• Energy led to the upside with a gain of over 3%.1

• Tech was the lone negative sector, losing -1.23%.1

The CBOE Volatility Index (VIX) declined -5% on the week to end at 14.21.1

US Treasury bond yields were lower last week.

• US 2yr -0.06% at 3.69%, 10yr -0.07% to 4.26%, 30yr -0.04% to 4.88%.1

• Yields continue to trade fairly rangebound awaiting further Fed & inflation data.

Commodities as an aggregate asset class moved higher last week.

• WTI Crude rose +1.48%.1

• Gold gained +1.04%.1

The US Dollar index moved lower by -0.15%.1

In our opinion, U.S. economic data was mixed week.

• The homebuilders index came in below expectations.1

• Existing home sales surprised to the upside while inventories also rose.1

• The Leading Economic Index fell once again for the 38th time out of the last 41 readings.1

An index of equities outside the US (FTSE All-World ex-US) rose +1.15%.1

Conclusion

Stocks ended the week higher after starting the week lower each of the first 4 trading days.

• Fed Chair Powell’s speech at the Jackson Hole Economic Symposium turned a souring investor sentiment around as he came across much more dovish than expected.1

• Small-caps once again led major equity markets higher with a gain of +3.39%.1

The S&P 500 squeaked out a small gain and the Dow gained over a percent.

• The Nasdaq lagged last week with a loss of -0.58%.

• The question remains whether this price action is rotation OR de-grossing by institutional investors where they’re simply selling positions to bring down overall exposure.

S&P 500 sub-sectors were mostly higher last week.

• Energy rode oil’s bounce higher to lead sector performance with a gain over 3%.1

• Materials, Financials, & Real Estate also gained over 2%.1

• Tech followed the Nasdaq lower to finish the week down over a percent.

All eyes are on Nvidia earnings this week as it is almost 8% of the S&P 500 index and is at the center of AI development. 1

• Additionally, 40% of NVDA’s revenue comes from just 4 of the largest tech companies…Meta, Microsoft, Alphabet, & Amazon1…making it a bellwether of the market at large as well as tech names.

Federal Reserve Chair Powell used his keynote speech on Friday to signal the Fed is headed for an interest-rate cut as soon as its next policy meeting in September.

• Yet there are clear divisions among policymakers over whether that’s the right call.

• Powell, himself, noted the economy has handed Fed officials a “challenging situation.” 1

• Policymakers are grappling with inflation that’s still above their 2% goal — and rising — and a labor market that’s showing signs of weakness.

• That unnerving reality, which pulls policy in opposite directions, is made worse by a high degree of uncertainty about how each of those factors will evolve over the coming months.

• Interest rates moved lower across the curve last week.

Powell’s dovish pivot Friday has given momentum to the so-called curve steepening trade, a position that wagers short-term rates will fall the fastest as easier monetary policy promises to increase the pace of growth.

• On Friday, the yield difference between the five- and 30-year bonds reached the highest since 2021. 1

Commodities gained last week as both oil & gold rose.

• We are curious to see if oil will get back above the key level its price has just recently broken below.

• Despite the gain, gold continue to trade sideways around all-time highs.

  
  

Justin Greenhill - Chief Investment Officer – justin@sollinda.com 

Ryan A. Mumy, CFP®, AIF® - CEO – ryan@sollinda.com   

Phone:  844/662-1211

[1] Source: Bloomberg – 8/22/2025