Stock Market State Dashboard – July 1 2025
Executive Summary
The US stock market enters July 2025 with strong momentum: major indices at or near record highs, healthy technicals, and broad sector participation. Economic fundamentals and monetary liquidity present a mixed but stable backdrop, while news flow is generally positive with manageable levels of risk despite persistent geopolitical flashpoints.
Market Confidence Score:
Key Positives:
- Volatility is declining; VIX in downward trend
- Yield curve steepening; supportive for risk assets
- Credit spreads tightening; risk appetite strong
- Major indices (SPY, QQQ, DIA) and sectors in technical uptrends
- US dollar weakening; supports risk-on globally
- Most central banks expanding their balance sheets
- Oil prices down, gold rising: some evidence of defensive hedges
- Geopolitical tensions remain elevated though stable in July
- Fed signaling delayed rate cuts due to tariff and inflation concerns
- Some mega-cap leaders mixed; not all above both major moving averages
Scoring Breakdown
| Condition | Raw Values | Score | Rationale |
|---|---|---|---|
| VIX Volatility (30d ROC) | -0.61% (falling) | 5 | VIX ROC < 0 → Volatility falling, bullish |
| Yield Curve (5d KAMA ROC) | +5.89% (steepening) | 5 | Yield curve KAMA ROC rising, supportive for risk assets |
| Credit Spreads (30d ROC) | -5.63% (narrowing) | 5 | Credit spreads narrowing sharply, bullish for credit/risk |
| Market Breadth ($NYA200R/$NYA50R, KAMA ROC) | +1.82%, +0.40% (both rising) | 5 | Both NYA200R and NYA50R rising, breadth healthy |
| SPY Price vs 50/200SMA | Above both (617.85 vs. 581.27/581.59) | 5 | SPY above both key SMAs, uptrend confirmed |
| Leading Sectors (XLK/XLF/XLE 50/200SMA) | All above | 5 | All three above long-term trend, strong bull signal |
| Mega-cap Tech Trend (Magnificent 7, 50/200SMA) | Most above (MSFT, GOOGL, NVDA, META, TSLA up; AAPL/AMZN mixed) | 5 | Majority of mega-cap names confirmed uptrend |
| Risk Appetite (USO/GLD 252d ROC) | USO: -8.14% | GLD: +41.73% | 0 | Defensive posture; gold up, oil down |
| Put-Call Ratio ($CPCE 30d ROC) | +1.0 | 3 | Hedging increased slightly; not extreme fear |
| Macro Fundamentals | Mixed (CPI/UNRATE flat, GDP up, NAPM flat) | 3 | Some improvement, some stagnation; not worsening |
| US Dollar (365d ROC) | -3.97% (weakening) | 5 | If USD falling, risk-on globally |
| Global Liquidity (M2/balances, 252d ROC) | Majority expanding (ECB/BoJ/M2SL up) | 5 | Most major CBs expanding and M2SL positive |
| Major Indices Performance (252d ROC) | All positive (SPY: +13.5%, QQQ: +15.1%, DIA: +12.6%) | 5 | Indices performance confirms bull trend |
| SPY Price Percentile (365d HHV/LLV) | 617.85 (100%ile) | 5 | SPY at 1-year high; strong technicals |
| Major Risks in News | Stable; no acute new crises | 3 | Risks present but not elevated headlines |
| Central Bank Balance Sheets (252d ROC) | ECB/BoJ up, US Fed/BoC down (2 up/2 down) | 3 | Mixed liquidity picture |
Market News
- Major US indices closed the first half of 2025 at record or near-record highs; Q2 saw the S&P 500 rise 10%, Nasdaq up 18%
CNBC - The Dow climbed 400 points at the start of July as investors rotated out of tech and into cyclicals
MarketWatch - The US dollar is weakening; global money supply and liquidity metrics mostly positive, buoying risk assets
- Geopolitical tensions remain but risk premium easing for now: Middle East/Japan issues stabilized, oil prices soft
Reuters - Fed signals a cautious stance on rate cuts; July cut unlikely as tariff impact complicates inflation outlook
CNBC
- Earnings news: rotation from “Magnificent 7” mega-caps to broader cyclicals underway; tech taking a breather
- Inflation, unemployment, manufacturing data all in a holding pattern; no sharp negative surprises
- Major risks are manageable at present, with no “black swan” headlines driving fear or instability
- Key economic and policy news focus: Fed, US-China trade, Summer earnings season