Around the world, stocks recovered and bonds stabilized in July after their collective swoon in June. The S&P 500 rose 5.1% last month while foreign stocks, as measured by the MSCI EAFE Index, gained 5.3%. But while the S&P recouped all of its recent losses by setting a new all-time high in July, foreign stocks are still about -2.8% below their 2013 peak, which was set on May 22.
As for bonds, after spiking a full percentage point in May and June, the 10-year Treasury yield stabilized in July, hovering in a tight range between 2.5% and 2.7%. The lack of interest rate volatility proved positive for bonds, as the Barclays U.S. Aggregate Bond Index snapped its two-month losing streak with a 0.2% return in July. Meanwhile, foreign bonds, as measured by the iShares S&P/Citigroup International Treasury Bond ETF, fared even better with a 2.5% gain last month…
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