Weekly Market Commentary July 28, 2025
WEEK IN REVIEW
Markets digested a mixed bag of economic data this week, with housing and sentiment indicators taking center stage. While some metrics pointed to resilience, others hinted at emerging cracks in consumer and business confidence.
Housing: Optimism Tempered
Housing demand softened, casting a shadow over the prior week’s upbeat tone. On Wednesday, June existing home sales fell short of expectations, coming in at 3.93 million versus the 4.00 million forecast, marking a 2.7% decline from the previous month. Thursday’s new home sales report also missed forecasts, though it showed a modest 0.6% month-over-month increase, suggesting some underlying strength. However, the June building permits revision, while still above expectations, dampened enthusiasm as a leading indicator of future demand.
Sentiment: Manufacturing Weakens, Services Shine
Thursday’s Purchasing Managers’ Index (PMI) data painted a split picture. The manufacturing PMI dropped into contraction territory at 49.5 versus 52.7 expected, signaling caution among purchasing managers. In contrast, the services PMI surprised to the upside at 55.2 versus 53, reinforcing the narrative of robust consumer activity and validating the week prior’s strong retail sales figures.
Quick Hitters: Durable Goods, Oil, Jobs, Inflation
• Core durable goods orders for June edged up 0.2% versus 0.1% expected, pointing to steady business investment and manufacturing momentum
• Crude oil inventories declined for the second consecutive week, suggesting rising demand and broader economic strength
• Initial and continuing jobless Ccaims both came in below expectations, marking the sixth and third straight weeks of declines respectively, an encouraging sign for labor market stability
• Inflation expectations ticked higher as 10-year Treasury Inflation-Protected Securities (TIPS) yields fell and breakeven rates rose, indicating a modest uptick in forward-looking inflation sentiment
Click HERE to read more.