Client Market Update – August 2025

August was another busy month in markets, with investors balancing strong equity performance against ongoing concerns around tariffs, debt, and inflation. Here’s a concise update to help you understand what happened, why it matters, and what you can do to stay on track.

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August Snapshot

• Stocks (S&P 500): up about 2% in August; set new record highs late in the month.

  
  

• Small Caps (Russell 2000): outperformed larger companies by roughly 5%.

  
  

• 10-yr U.S. Treasury Yield: ended August around 4.23%.

  
  

• Gold: touched a record high during the month as investors sought safety.

  
  

• Bitcoin: finished August near $108,000 after a volatile summer.

  
  

• Oil (Brent): remained range-bound in the mid-$60s per barrel.

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Big Issues in August

• Tariffs: The U.S. kept pressure on trade partners, creating uncertainty for global companies.

  
  

• Debt & Rates: Government borrowing stayed heavy. Yields hovered above 4.2%.

  
  

• Inflation: July consumer prices, reported in August, rose 2.7% year-over-year.

  
  

• Gold Rush: Geopolitical and policy worries helped push gold futures to a record.

  
  

• Crypto Volatility: Bitcoin cooled into month-end near $108k, while Ethereum gained interest.

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Special Focus – Never Bet Against America

A recent article reminded us why the U.S. continues to hold unmatched long-term strengths, whatever the headlines may suggest:

• The world’s largest connected farmland and river system, enabling cheap and efficient trade.

  
  

• Natural defenses from two oceans and multiple mountain ranges.

  
  

• Energy independence as the leading oil and gas producer.

  
  

• Global alliances that extend U.S. reach and influence.

  
  

• Client takeaway: short-term noise aside, U.S. innovation and scale remain powerful drivers.

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What You Can Do

• Stay diversified: hold a mix of U.S., global, and real assets like gold or commodities.

  
  

• Keep bond risk modest: favor short- to medium-term bonds while yields remain elevated.

  
  

• Focus on quality: companies with strong balance sheets and pricing power.

  
  

• Crypto with care: keep allocations small and use regulated funds only.

  
  

• Maintain a cash buffer: ideally three months of spending in an easy-access account.

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Bottom Line

Markets in August reminded us that while headlines can be noisy—tariffs, debt, inflation—the deeper story is that America’s long-term advantages and global scale remain powerful. The best approach is to stay balanced, diversified, and in regular contact with your JSG adviser to ensure your investments remain aligned with your goals.

Call to Action:

Stay close with your adviser within the JSG Network to ensure your investment strategy and portfolios stay relevant to the market as well as to your risk profile and timeframe(s).

— The Just Service Global Client Service Team

Market Update – August 2025

1. The Big Picture: What’s Changed Since July?

The cross-currents of policy and economic data intensified as we moved into August. The market is now digesting implemented tariffs and another month of stubborn inflation, creating a more complex landscape than we saw in Q2.

Indicator (latest read)	Direction	Why It Matters
US-EU/Mexico Tariffs	↑	The threatened 30% blanket tariff on many goods was implemented on August 1st after talks failed to produce a last-minute deal.
July CPI (released Aug 12)	↑ to 2.9%	Inflation accelerated slightly again, cementing fears that price pressures are becoming entrenched despite a slowing economy
10-Year Treasury Yield	↑ to 4.65%	The bond market is demanding higher returns to compensate for persistent inflation and the deluge of new government debt.
Q2 Earnings Season	→ / ↓	Most companies beat lowered expectations, but management commentary was overwhelmingly cautious, citing margin pressure from rising costs and new tariffs.

Sources: Bloomberg, U.S. Bureau of Labor Statistics, JSG Analysis

2. Two Core Narratives Driving Markets Now

A. From Tariff Threat to Tariff Reality The trade story has shifted from a risk to a reality. The implementation of broad tariffs on August 1st triggered immediate, though measured, retaliation from European and Mexican trade officials. The direct impact is now visible in sectors heavily reliant on international supply chains, particularly automotive, industrial machinery, and consumer electronics. The key question for the second half of the year is whether this is the final move or the opening salvo in a wider trade conflict.

• Portfolio Angle: The case for owning companies with domestic US focus, resilient supply chains, and strong pricing power (the ability to pass on costs) has strengthened. Multinationals with complex global operations face significant earnings headwinds.

B. The "Stagflation" Whisper Gets Louder July’s economic data painted a challenging picture: economic growth is clearly moderating (evidenced by cautious corporate outlooks) while inflation remains sticky and above target. This combination—stagnant growth plus inflation—is known as stagflation, an environment that can be punishing for both stocks and bonds. While we are not officially in a stagflationary period, the market is beginning to price in the risk.

• Portfolio Angle: In this environment, real assets historically perform well. This includes commodities like gold and energy, and inflation-protected bonds (TIPS). Quality stocks with low debt and stable cash flows are also better positioned to weather an economic slowdown than high-growth, speculative names.

3. Beyond the Headlines: The Growing Appeal of Private Credit

As banks tighten lending standards amidst economic uncertainty, many solid mid-sized companies are turning to non-bank lenders for capital. This has super-charged the world of Private Credit. These investments, which involve lending money directly to companies, can offer attractive yields (often floating-rate, which benefit when rates rise) and are not subject to daily stock market volatility. Once the domain of large institutions, this asset class is becoming more accessible to qualified investors through specialized funds. It represents a compelling alternative income source but comes with its own risks, primarily illiquidity (you can’t sell instantly) and credit risk (the borrower could default).

4. Action Checklist for August

• Prioritise Quality: Within your equity allocation, lean towards companies with fortress-like balance sheets and a history of dividend growth.

• Keep Bond Duration Short: With yields still trending higher, longer-term bonds remain vulnerable. Short-term bonds and floating-rate notes offer a safer harbour for fixed-income allocations.

• Crypto Consolidation: After hitting a new high near $123,000 in July, Bitcoin has pulled back and is consolidating. This is a healthy, expected pattern. The "digital gold" narrative in an era of high debt remains intact, but volatility is a given. Keep allocations small and use regulated ETFs for simplicity and security.

5. Bottom Line

The market has entered a tougher phase where the theoretical risks of June have become the concrete headwinds of August. Navigating the twin challenges of implemented tariffs and stagflationary pressures requires a defensive and deliberate approach. A balanced portfolio of quality equities, short-duration bonds, real assets, and (for suitable investors) select alternatives remains the most prudent strategy.

As always, please reach out to your Just Service Global adviser to discuss how these developments impact your specific financial goals.

— The Just Service Global Client Service Team

Mid‑Month Market Update – July 2025

1. What’s New Since Late June

Indicator (latest read)	Direction	Why it matters
Consumer Price Index (CPI): prices up 2.7 % year over year in June	↑ from 2.4 %	This lift keeps inflation in focus
Jobless claims: 227 000 in early July	↓ fourth weekly drop	Labour market still firm despite slowdown worries
10‑year Treasury yield: 4.50 % on 15 July	↑ from 4.26 % at end‑June	Higher borrowing costs for mortgages and companies
Bitcoin: record 123 000 USD (14 July)	↑ 25 % since mid‑June	“Hard‑asset” hedge appeal grows as debt climbs

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2. Two Big Policy Dramas

1. Tariffs enter overtime

The countdown shifts. A July 9 deadline for a deal with Europe passed without new duties, but Washington has now threatened a 30 % blanket tariff on imports from both the European Union and Mexico starting 1 August if talks stall. Wider levies—up to 50 % on some metals and goods from other trade partners—are also on the table. European officials are already mapping out retaliation plans.

Portfolio angle: Companies that rely on global supply chains (autos, electronics, apparel) could see margins squeezed next quarter. Domestically focused software, healthcare, and utilities remain relatively insulated.

2. The debt ceiling is gone, but the bill is growing

Unlimited federal borrowing continues after the June law that removed the cap. With national debt near 36 trillion USD and headed toward 55 trillion in a decade, interest payments already exceed defence spending. Higher Treasury issuance is beginning to nudge yields up, which feeds back into mortgage costs and corporate financing.

Portfolio angle: Short‑dated bonds and floating‑rate notes carry less price risk than long 20‑ or 30‑year maturities. A small allocation to real assets—commodities, inflation‑linked bonds, or even tightly regulated crypto exchange‑traded funds—can help offset currency weakness if the dollar drifts lower.

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3. Action Checklist for July Clients

1. Stay balanced between growth stocks (technology, biotech) and defense plays (consumer staples, healthcare services).

2. Keep bond duration short—yields are rising faster than many expected.

3. Hold three months of living costs in easy‑access cash or money‑market funds to cushion surprises.

4. Review exposure to non‑U.S. assets. A softer dollar lifts foreign returns in dollar terms.

5. Crypto: proceed with caution. Limit any position to a size you can tolerate in a 40 % drawdown; prefer transparent, regulated funds over unverified platforms.

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4. Bottom Line

Maintaining a well‑diversified mix—quality equities, shorter bonds, selective real assets, and (if appropriate) a measured crypto slice—remains the most sensible path.

Stay in touch with your Just Service Global adviser to adjust holdings as data and policies evolve through the rest of July.

— Just Service Client Service Team

Stay in close touch with your adviser in the Just Service Global (JSG) Network to keep your personal financial planning on track.