- Stocks were modestly higher in July, as investor expectations for further central bank intervention increased. Domestically, mega caps led the pack while small caps lost ground. International stocks also posted gains, but still lag domestic equities year-to-date.
- Long-term Treasury yields fell in July, boosting core bond returns. High yield bonds also rallied with other risk assets. Rising food prices generally offset falling energy costs in June, as inflation remained relatively flat.
- The economy grew at a lackluster 1.5% annualized pace in the second quarter, as consumer and business spending slowed. The Fed acknowledged the slowdown in growth, but left policy unchanged at its August meeting.
- Employment took one step forward and one step back in July. Job creation grew at a stronger-than-expected pace while the unemployment rate ticked upward to 8.3%, signaling continuing challenges in the labor market.