Equity markets posted modest gains across major indices last week, driven by improving earnings estimates and a resilient economic backdrop. The S&P 500 rose 1.46%, bringing its year-to-date return to 8.62%, while the NASDAQ led with a 9.31% YTD gain. International markets showed strength, with the iShares EAFE Index up 2.7% for the week and over 20% YTD. Although market valuations are high—particularly the S&P 500 at 22.7x forward earnings—upward revisions in corporate earnings forecasts for 2025 and 2026 have helped support prices. Investor sentiment has normalized, and meme stocks have shown renewed volatility. Gold remains a top-performing asset in 2025, up nearly 27%, while the U.S. dollar index has weakened substantially, down over 7%.

Strategically, PVG Asset Management has adopted a cautious tone amid strong technical conditions and potential seasonal weakness. Technology earnings have underwhelmed, especially in semiconductors, while financials delivered strong results with limited upside. Healthcare and industrials are leading sector gains, while consumer discretionary and staples lag. PVG has taken profits and selectively initiated hedges ahead of the Federal Reserve’s upcoming decision, which may set the stage for a rate cut in September. Employment, GDP, and inflation data this week will be key in shaping Fed policy and investor expectations for the rest of the year.

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