Market Perspectives (July 2012)

by Jim Baird on July 16, 2012

Executive Summary

  • Equities rallied in June, although losses from the prior two months left stocks in the red for the second quarter.  International equities had a strong boost following the EU Summit, but still lag their domestic counterpart’s year-to-date.
  • Treasury yields edged higher in June, leaving high-quality bonds in flat to negative territory.  Coming out of its June meeting, the Fed announced the extension of Operation Twist through the end of the year. 
  • Economic growth remained a subpar 1.9% for the first quarter and is expected to remain in a similar territory for the second quarter, although that may be subject to adjustments as additional data is available in the weeks ahead. 
  • The employment picture remains weakened, with the economy adding an average of only 75,000 new jobs per month during the last three months.  The unemployment rate held steady at 8.2% in June, but remains elevated as we edge closer toward the 2012 election.

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