New York
CNN
—
US stocks gained on Monday, capping off a strong month and a remarkable second quarter for Wall Street.
The Dow closed higher by 276 points, or 0.63%. The broader S&P 500 rose 0.52% and the tech-heavy Nasdaq Composite gained 0.47%.
The S&P 500 and Nasdaq both closed at fresh record highs, extending their gains after notching record highs on Friday.
The S&P 500 posted its best quarter since December 2023. The Nasdaq posted its best quarter since June 2020. It was a major rebound after markets had a dismal first quarter.
After tumbling in March and early April as President Donald Trump’s tariff policy shocked Wall Street, stocks then recovered their losses across May and June. At the halfway point into the year, the mood is remarkably different from three months ago.
Investors have cheered as stocks have swiftly recovered to fresh highs and volatility has subsided. Yet stocks are now relatively expensive and the economic backdrop remains uncertain, leaving questions about what catalyst might push markets higher.
“The economic outlook for the second half of 2025 is highly sensitive to the path of government policy,” said Jason Pride, chief of investment strategy and research at Glenmede, in an email.
Wall Street this week will focus on new monthly data on job growth in June, set to be released on Thursday. Markets will be closed on Friday for the Fourth of July holiday.
After dropping 4.59% in the first quarter of the year, the S&P 500 gained 10.57% in the second quarter. The S&P 500 is up 24.5% since hitting its low point on April 8, defying expectations as it has climbed back from the precipice of a bear market.
Sam Stovall, chief investment strategist at CFRA Research, said the main factor contributing to the S&P 500’s decline in the first quarter was “a growing concern that the US would fall into recession as a result of the onerous tariffs placed on all major global trading partners.”
As the worst of tariff fears have subsided, markets have staged a V-shaped recovery. That rebound has been led by the sectors that were hit the most in the first quarter, Stovall said. The S&P 500 rose 4.96% in June and is up 5.5% on the year.
Meanwhile, the tech-heavy Nasdaq has surged 33% since its low point on April 8. The index, led by stocks like Nvidia (NVDA) and Microsoft (MSFT), has roared back from a bear market as optimism about the AI boom has resurged.
“Tech has been outperforming the markets since the April lows and we would expect tech’s leadership to continue in the second half of 2025, especially as investors start to resume their excitement about the promise of artificial intelligence, which had faded during the midst of the tariff selloff in March and April,” Clark Bellin, president and CIO at Bellwether Wealth, said in an email.
The dollar has broadly declined this year, raising concerns about investors’ confidence in the United States.
The US dollar index, which measures the dollar’s strength against six major foreign currencies, has tumbled 7% in the second quarter and is down 10.7% this year.
The dollar index posted its worst first half of the year since 1973, according to data from Intercontinental Exchange. The index slumped 15% across the first six months of 1973.
While stocks have rebounded from their April lows, the dollar has continued a precipitous decline. The dollar index on Monday slid 0.55% and hovered around its lowest level since 2022.
The euro is up 13% against the dollar this year. The British pound is up 9% against the dollar.
Francesco Pesole, an FX strategist at ING, previously told CNN the dollar’s status as a strong currency and haven that investors turn to during times of stress is being dented.
Wall Street’s fear gauge, the CBOE Volatility Index, went on a roller coaster in the second quarter that finished with a calm ending.
As Trump’s tariff proposals stoked historic levels of uncertainty and volatility on Wall Street in early April, the VIX spiked to levels not seen other than during the Covid pandemic and the 2008 financial crisis.
The VIX settled across May and June and gradually slid lower. After surging 28% in the first quarter, the fear gauge fell almost 27% in the second quarter.
The VIX on Monday traded around 17 points compared with trading above 50 points in early April.
The sentiments driving markets shifted from “extreme fear” or “fear” in April to “greed” or “neutral” in May and June, according to CNN’s Fear and Greed index.
At the start of the quarter, the Treasury market was enveloped in abnormal uncertainty and volatility.
The normally quiet, boring corner of the market garnered widespread attention due to concerns that global investors might be shunning US debt amid concerns about the health of the US economy.
Bond investors breathed a sigh of relief in June after a Treasury auction for 30-year bonds went relatively well. Foreign investors showed up to buy, easing nerves that they might be moving away from American assets.
The yield on the 10-year Treasury on Monday traded around 4.24%. The 30-year yield traded around 4.8%.
Oil rises and falls
Oil prices saw enormous spikes in June as the world wrestled with brewing conflict between Israel and Iran.
West Texas Intermediate crude futures, the US oil benchmark, surged as high as $73.85 per barrel. Brent crude futures, the global benchmark, surged as high as $78.85 per barrel.
US oil and Brent on June 13 posted their biggest single-day surge since 2022 after Russia’s invasion of Ukraine.
As tensions settled, oil prices dropped lower to the levels they traded at before the conflict. US oil on Monday fell 0.6% to $65.11 per barrel. Brent was down 0.2% to roughly $66.61 per barrel as of the afternoon.
Precious metals like silver and platinum emerged as stars of the second quarter. Silver and platinum prices soared in recent weeks as investors sought out safe havens besides gold.
Gold, a traditional safe haven, has smashed through record highs across the past two years. As gold has become more expensive, investors have sought out cheaper precious metals. Gold is up almost 26% this year but posted a gain of just 0.1% in June as the rally in the yellow metal stalled.
Meanwhile, silver prices soared almost 10% in June. In addition to investors, industrial demand helped push the price of silver higher. Silver is up 24% this year.
Platinum prices are up 28% in June and 49% this year. Platinum is on track for its best quarter and best monthly gain since 2008. There has been a resurgence in demand for platinum jewelry, boosting the precious metal’s price, according to analysts at Bank of America.
Retail investors who “bought the dip” have been key drivers of the market rally this year. Retail investors poured $3.2 billion into stocks from June 18 to 24, according to data from Emma Wu, a strategist at JPMorgan Chase.
Wall Street money and global investors have showed less conviction in US markets, but have cash sitting on the sidelines. “The big conundrum facing investors for the second half of 2025 is how to deploy new cash, especially for investors who did not put new money to work during the April market pullback,” Bellin said. “Stocks are expensive, but we remain on the lookout for pullbacks.”
“In the background, investors have been cash rich and supportive of the move higher in the risky assets,” said Mohit Kumar, chief economist and strategist for Europe at Jefferies, in a note. “Underinvested positions was one of the reasons we had been in the camp that the path of least resistance should be higher for risky assets.”
Kumar said he does not expect a “massive rally” from here but believes it will be a “slow grind” to higher levels.
While the S&P 500 and Nasdaq have reached all-time highs, the Dow is roughly 1,000 points, or 2.1%, away from its record high.
