Midyear Outlook 2025: Pragmatic Optimism, Measured Expectations

LPL Research recently unveiled Midyear Outlook 2025: Pragmatic Optimism, Measured Expectations, their semi-annual report that recaps where markets and the economy have been over the first half of 2025 and where they may be going over the remainder of the year. I’m pleased to bring you a few of the key highlights today. 

If “tariff” isn’t the word of the year, then perhaps it’s “uncertainty” or even “volatility.” Much of this year’s market turbulence has stemmed from the assumption that President Trump’s second-term policies would closely resemble those of his first. As it became clear that this would not be the case, markets were forced to recalibrate.

While uncertainty is likely to persist for the near future, the peak of policy-driven volatility may be behind us. As clarity returns, so too should market stability — bringing with it a range of new investment opportunities. Given the economic distortions of recent months, it is a difficult time to hold strong convictions. However, some clarity is expected to emerge in the second half of the year.

LPL Research believes the economy will begin to reflect the delayed effects of trade policy, including slower labor demand, weaker growth, and a modest uptick in inflation. This challenging backdrop will likely create bouts of continued volatility in the stock market, but ultimately, equities are expected to finish the year moderately higher. We believe neither the White House nor the Federal Reserve is permanently committed to their current policy paths, which leaves room for constructive shifts in this environment: 

·         The importance of diversifying across asset classes and geographic regions cannot be emphasized enough

·         Integrating investments that may enhance portfolio stability and have low correlation to traditional markets, like alternatives, is favored

·         Periods of volatility should be viewed as opportunities to selectively increase equity exposure at more attractive levels.

Thesearejustsomeoftheinsightsyou’llfindinMidyear Outlook 2025: Pragmatic Optimism, Measured Expectations. Togetmore,including considerations and potential action steps we can discuss, visit go.lpl.com/investormidyearoutlook.

Wishing you a safe and enjoyable summer. As always, please reach out to me with questions.

Sincerely,

Manny Tsesmelis, AAMS®

LPL Financial Advisor

Tsesmelis Wealth Management, Inc.

Important Information

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.  

All data is provided as of July 8, 2025. 

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk. 

Past performance does not guarantee future results.

Asset allocation does not ensure a profit or protect against a loss. 

This research material was prepared by LPL Financial, LLC.

RES-0003846-0425 | For Public Use | Tracking #758291| #758292(Exp. 07/2026)