The U.S. equity market experienced a sharp reversal from the downturn that occurred in May. Stocks rose 7.0% during the month on their way to notching the best first half of a year in 22 years for the S&P 500. Positive market action in the second quarter was driven largely by the Federal Reserve signaling the possibility of cutting rates in the event of tariffs negatively impacting the economy. This news boosted confidence that any blow of continued tensions between the U.S. and China would be softened.

 

The Group of 20 (G-20) meeting occurred the last weekend of June where President Trump and President Xi met face-to-face for the first time since rhetoric intensified in May. Initial reports appeared positive and further details from this round of trade talks will likely influence market action and volatility.

 

Around the globe, emerging markets bounced back after a dismal May and European stocks also experienced their best first half of a year in two decades. These markets’ actions were driven by similar factors as the S&P 500 and are likely to be influenced by trade discussions in the coming weeks.