Financial markets calmer in May

Select Wealth Management – Monthly View – June 2025

Global financial markets were calmer in May, following extreme volatility in April. The US S&P 500 Index led global sharemarkets higher, gaining 6.2%.

There is a risk that no clarity is gained on the outcomes of trade negotiations by the end of the year. It is also possible that Trump will persevere with his Liberation Day trade policy, which would be negative for markets.

Alternatively, ongoing tariff negotiations may bring some positive surprises for markets. Other developments may also bring further relief for global financial markets.

New Zealand’s sharemarket rose 4.3% in May. While the profit results were mixed, they generally had a positive tone relative to expectations and displayed positive earnings growth. This was pleasing after two years of disappointing corporate earnings outcomes.

Global bond fell -0.4% in May as US longer-term interest rates rose on growing concerns over the US budget deficit and rising debt levels.

New Zealand’s fixed income market also fell by -0.4% in May on rising US interest rates and disappointment regarding the outlook for the future direction of the OCR, relative to market expectations that the RBNZ would provide a clearer signal of further interest rate cuts.

Select Wealth Management’s Monthly View (June 2025) is available at this link.