Dear Clients,

As we navigate through the current economic landscape, we aim to provide you with insightful observations that can guide your investment strategies. Despite some mixed signals in sentiment data, the underlying economic indicators remain robust, with a low unemployment rate and inflation close to target levels. While the Federal Reserve remains cautious, potential rate cuts are anticipated in the coming year. The bond market is under pressure due to deficit concerns, yet gold has surged, reflecting its role as a safe haven amidst a weakening dollar. Market volatility persists across various sectors, but asset prices continue their upward trajectory. Our investment strategy focuses on managing risks and leveraging opportunities, particularly in fixed income and multi-asset alternative strategies. As always, we emphasize the importance of staying invested and maintaining a diversified portfolio to achieve longterm success. We hope these insights prove valuable as you assess your investment decisions.

General Observations:

  • Soft sentiment data from consumers and businesses hasn't impacted hard data yet. 
  • Unemployment rate remains low, with the rate at 4.1% as of June. 
  • Inflation ticked up in July but remains near 2% targets and doesn’t not yet reflect market expectations of tariff impacts.
  • Forecasts still anticipate potential rate cuts in 2025, but thus far, the Fed remains cautious while watching for developments in unemployment and inflation.
  • The yield curve remains steep, deficit concerns continue to put pressure on bond markets. 
  • Gold is up over 30% YTD. This is likely due to a weakening dollar and gold being viewed as an alternative and a store of value.  

Market Volatility:

  • Equity volatility has softened but remains elevated with cross currents among S&P 500 sectors. Interest rate, oil prices and FX market volatility off highs but above historical averages. 
  • Despite volatility, asset prices continue to rise.

Investment Strategy Notes & Highlights

  • Multiple EIM fixed income subadvisors report that they are focused on the "belly of the curve" to manage duration risks.
  • Multi-asset alternative strategies have performed well, particularly in commodities and precious metals. 

EIM Mantras:

  • Stay invested despite geopolitical and economic concerns.
  • Diversification and rebalancing are necessities for long-term success. 

Market Observations as of 7/9/2025, subject to change and not to be used or interpreted as a recommendation. 

IMPORTANT INFORMATION

Definitions:

S&P 500 Index is a weighted index of common stocks of 500 leading companies in leading industries of the U.S. economy, capturing 75% coverage of U.S. equities. The index is capitalization weighted, thereby giving greater weight to companies with the largest market capitalizations.

Russell 1000® Growth Index measures the performance of those Russell 1000® Index companies with higher price-to-book ratios and higher forecasted growth values. It is market-capitalization weighted.

A basis point (BPS) is a unit of measure used to indicate percentage changes in financial instruments. Basis points are typically expressed with the abbreviations "bp," "bps," or "bips." One basis point is equal to 1/100th of 1%, or 0.01%. In decimal form, one basis point appears as 0.0001 (0.01/100).

Information provided in this newsletter is general in nature, is provided for informational purposes only and should not be construed as investment advice. The views and opinions expressed are those of the author(s) as of the stated date of their contribution and any such views and opinions are subject to change at any time based on market, or other conditions, and are not intended to be a forecast of future events, a guarantee of future results or investment advice. Securities and sectors referenced should not be construed as a solicitation or recommendation, or be used as the sole basis for any investment decision.

All investments contain risk and may lose value. Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these investment strategies will work under all market conditions or are appropriate for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Outlook and strategies are subject to change without notice.

Past performance is not a guarantee of future results. Portfolio re-balancing and diversification do not guarantee a profit or protection against loss in a declining market.

No guarantee or representation is made that investment objectives and/or opinions stated will be achieved. The experience of each specific client or investor may vary.

Due to the subjective aspect of these analyses, the effective evolution of the economic variables and values of the financial markets could be significantly different from the projections, forecasts, anticipations and hypotheses, which are communicated in this material.

Quick Takes feature commentary from subadvisors of investment portfolios that are available through model portfolios, mutual funds variable life insurance policies and variable annuity contracts issued by Equitable Financial Life Insurance Company of America (Equitable America) (AZ stock company) with an administrative office located in Charlotte, NC, and Equitable Financial Life Insurance Company (Equitable Financial) (NY, NY), and mutual fund products.  Variable annuities and variable life insurance products are co-distributed through Equitable Advisors, LLC (member FINRA, SIPC) (Equitable Financial Advisors in MI and TN) and Equitable Distributors, LLC.

Equitable Investment Management Group, LLC (EIMG) is a wholly-owned subsidiary of Equitable Financial, which is an indirect, wholly-owned subsidiary of Equitable Holdings, Inc. Equitable Investment Management, LLC (EIM LLC) is an indirect, wholly-owned subsidiary of Equitable Holdings, Inc.  EIMG and EIM LLC are affiliates of Equitable Advisors and AllianceBernstein L.P ("AB"). References to “Equitable Investment Management” include EIMG, and its affiliate, EIM LLC, unless otherwise stated.

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GE-8184834.1 (07/2025) (Exp. 07/2029)