July was a telling month for global investors, as regional divergences in central bank policy and underlying economic momentum became increasingly impactful on relative currency moves. The U.S. dollar reached its trough on July 1, and the subsequent rally into the end of the month reduced international equity returns (in U.S. dollar terms).

Global equities performed well in June, driven by a confluence of dovish central bank policies, divergent economic releases, and gyrating trade dynamics in the U.S., China, the Eurozone, Canada, Japan, and the Pacific region.

During May, global equity markets exhibited mixed results across key regions. These shifts were largely influenced by a weakening U.S. dollar, changes in central bank policies, and ongoing geopolitical developments. The U.S. Dollar Index (DXY) declined by 8.13% year-to-date.

Given the massive swings in the market last month, it may surprise you to learn that the S&P 500 was down only -0.68% for the month. Perhaps more surprising is that the Nasdaq Composite was up 0.85%. Internationally, Japan, Germany, and Canada were also up (0.37%, 2.17%, and 0.15%, respectively). Fixed income also increased, with the Barclays Capital Aggregate Bonds Total Return up 0.42%.

Global stock markets experienced a volatile month, shaped by a mix of macroeconomic shifts, policy uncertainties, and key economic releases. Below, we explore the factors, issues, and data points that influenced the U.S., European, Emerging Market, Japanese, Canadian, and Pacific ex-Japan stock markets last month.

International equities outperformed the U.S. in February, with Europe leading the way. Spain, the U.K., Germany, Hong Kong, and China gained significant ground while the U.S., Taiwan, Australia, Japan, and India lagged.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model (Figure 1) improved in January and entered February with a fully invested equity allocation recommendation. We will raise cash if our models shift to bearish levels (below 40% for two consecutive days).

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model held steady in December and entered January with a fully invested equity allocation recommendation. We will raise cash if our models shift to bearish levels (below 40% for two consecutive days).

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model (Figure 1) held steady in November and entered December with a fully invested equity allocation recommendation. If our models shift to bearish levels (below 40% for two consecutive days), we will raise cash.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model declined toward the end of October but entered November with a fully invested equity allocation recommendation. If our models shift to bearish levels (below 40% for two consecutive days), we will raise cash.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model improved toward the end of September and entered October with a fully invested equity allocation recommendation.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model declined toward the end of August but entered September with a fully invested equity allocation recommendation.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model held steady during July and entered August with a fully invested equity allocation recommendation.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model held steady during June and entered July with a fully invested equity allocation recommendation.

The Catastrophic Stop model combines time-tested, objective indicators designed to identify high-risk periods for the equity market. The model improved during the month and entered June with a fully invested equity allocation recommendation.

Entering May, the non-U.S. equity Core model overweighted China, France, and Germany. Japan, the U.K., Canada, Switzerland, and Australia were below benchmark weighting. The Explore model favored Israel, Mexico, Malaysia, Netherlands, and Sweden.

Entering April, the non-U.S. equity Core model overweighted China and Germany. Japan and Canada are neutral. The U.K., France, Switzerland, and Australia are underweight. The Explore model favored Malaysia, the Philippines, Poland, Sweden, and Taiwan.

Entering March, the non-U.S. equity Core model overweighted Japan and Germany. China and Canada are neutral, and the U.K., France, Switzerland, and Australia are underweight. The Explore model favored Mexico, Turkey, Brazil, Spain, and the Philippines.

Entering February, the non-U.S. equity Core model overweighted Canada and Germany. Japan was neutral, while the U.K., China, France, Australia, and Switzerland were underweight. The Explore model favored Brazil, Peru, Spain, Poland, and the Philippines.

The Catastrophic Stop model improved from last month, as it recommends a fully invested allocation. Entering January, the non-U.S. equity Core model overweighted Canada, Australia, and Germany while underweighting the U.K., China, France, and Switzerland. The Explore model favored Mexico, the Netherlands, South Africa, Poland, and Turkey.