This Weekly Financial Markets Update reviews the top market headlines: Fed Chair Powell Hints at Dovish Tilt, Housing Starts to Jump in July, Leading Indicators Continue Downward Trend
  • The current federal funds rate target range is 4.25% to 4.50%
  • Housing starts rose 12.9% in July versus the prior year
  • The U.S. Leading Economic Index was down 0.1% in July

Top Three Market Headlines

Fed Chair Powell Hints at Dovish Tilt: Federal Reserve Chair Jerome Powell last week seemingly threw his support behind cutting interest rates at the central bank's next meeting to be held in September. In a highly anticipated speech in Jackson Hole, WY, Mr. Powell noted that rising risks of disappointing labor market developments may "warrant adjusting our policy stance." The comments followed the release days earlier of minutes from the Fed's last meeting in July, which revealed committee members balancing concerns about both the labor market and continued risks of higher inflation in deciding to leave the bank's target policy rate unchanged at 4.25%-4.50% at that time.

Housing Starts to Jump in July: The U.S. Census Bureau reported last week that the number of new housing units under construction in July hit a seasonally adjusted annual rate (SAAR) of 1.428 million. This was a five-month high and was up 5.2% from the prior month and 12.9% from July 2024. Activity was particularly robust across apartment properties, where starts rose 27.4% versus last year to 470,000 (SAAR), the highest level since May 2023, suggesting the housing market is responding to an increasing demand for rental properties. The rate of starts for single-family units also increased, though at a more measured pace, up 7.8% versus the prior year.

Leading Indicators Continue Downward Trend: The Conference Board last week released the latest reading of its U.S. Leading Economic Index (LEI), a composite of economic data points designed to indicate turning points in the business cycle. The LEI ticked down by 0.1% in July from June, its seventh decline in the last eight months. According to the Conference Board, warning consumer sentiment and weakness in new business orders put pressure on the index in July while rising stock prices and lower initial claims for unemployment insurance provided support. The Conference Board noted that it expects the economy to weaken in the second half of 2025 but does not project a recession.

Please note: There will be no Weekly Financial Market Update published next week. We would like to wish everyone a happy Labor Day!

As of August 22, 2025 Week Quarter-To-Date Year-To-Date One-Year
MSCI All Country World 0.37% 4.26% 14.74% 17.81%
S&P 500 0.30% 4.40% 10.88% 17.63%
Russell 2000 3.32% 8.77% 6.82% 11.37%
MSCI EAFE 0.84% 4.30% 24.58% 17.42%
MSCI Emerging Markets -0.41% 4.04% 19.93% 17.61%
FTSE NAREIT Equity 2.77% 2.63% 2.37% 1.15%
Bloomberg Commodity 1.33% 0.24% 5.78% 11.53%
Bloomberg U.S. Aggregate 0.43% 0.77% 4.82% 2.86%

US Census Bureau 8/19/2025, Reuters 8/19/2025, WSJ 8/22/2025, Federal Reserve 8/20/2025, The Conference Board 8/21/25. Data from Morningstar Direct. Returns for periods greater than one year are annualized. Investment advisory services are offered by Gallagher Fiduciary Advisors, LLC ("GFA"), an SEC registered investment advisor that provides retirement, investment advisory, discretionary and independent fiduciary services. Registration as an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the SEC. GFA is a limited liability company with Gallagher Benefit Services, Inc. as its single member. GFA may pay referral fees or other remuneration to employees of Arthur J. Gallagher & Co. or its affiliates or to independent contractors; such payments do not change our fee. Neither Arthur J. Gallagher & Co., GFA, their affiliates nor representatives provide accounting, legal or tax advice. GFA does not express an investment opinion regarding any specific commodity, sector or individual security. Unless otherwise expressly noted, the contents of this communication do not constitute securities or investment advice, nor should this communication be construed as an opinion regarding the appropriateness of any investment. The information provided cannot take into account all the various factors that may affect your particular situation, therefore you should consult your GFA consultant before acting upon any information or recommendation contained herein to discuss the suitability of the information/recommendation for your specific situation.