Global stock markets closed out June on a mixed note, pulling back from their May highs. In what turned out to be a paradoxical month, the main piece of good news was the plunge in oil prices amid the de-escalation of the conflict in the Middle East; however, a shift toward tighter monetary policy by the Federal Reserve under its new leadership and a correction in the semiconductor sector weighed on the markets. The semiconductor sector led the month’s declines following a sharp global sell-off in technology stocks, triggered by a correction in Asian markets and renewed doubts about the pace of investment in artificial intelligence infrastructure.

Index performance reflected a marked rotation; the S&P 500 fell 1.06% for the month but remains up a solid 9.55% year-to-date; the Nasdaq, which is more exposed to semiconductors, fell 2.81% in June, though it remains the year-to-date leader with a gain of 12.79%; meanwhile, the Dow Jones was the exception on the upside, advancing 2.52% for the month and 8.85% for the year, buoyed by a shift of capital toward defensive and value sectors. With the S&P 500 trading at around 20 times forward 12-month earnings, valuations are reasonable and in line with their average over the past 5 years and slightly above their historical average over the past 10 years.

The key event of the month in the fixed-income market was the shift in U.S. monetary policy. At the June 17 meeting—the first chaired by Kevin Warsh—the Fed unanimously kept the rate in the 3.50% to 3.75% range, but the projections shifted toward a more restrictive stance: the median view among members now anticipates higher rates toward the end of 2026, reversing the expectation of rate cuts that had prevailed in March, with 17 of the 18 participants judging that inflation risks are skewed to the upside. Consequently, investment-grade credit generated a return of 0.19% for the month, while high-yield bonds returned 0.27%; the latter has accumulated 1.96% year-to-date and is performing favorably within the debt markets.

The Fed’s tougher tone was felt across the rest of the global asset classes, with particularly severe impacts on safe-haven assets and the most speculative segments. Gold fell 11.45% for the month, erasing its year-to-date gain and posting a cumulative loss of 6.97%, under pressure from the strengthening dollar and the rise in real interest rates. Bitcoin was also among the hardest hit, with a 20.36% drop that deepened its year-to-date loss to 33.09%, clearly reflecting the rotation of capital toward assets with stronger fundamentals. Copper, on the other hand, showed greater resilience: despite falling 3.08% for the month, it remains up 8.98% for the year, supported by structural demand linked to electrification and artificial intelligence.

In the local market, the outlook was more stable. The Bank of Mexico kept its benchmark rate unchanged at 6.50% at its June meeting, a widely anticipated pause following the conclusion of the rate-cut cycle in May. Headline inflation slowed to an annual rate of 3.55% in the first half of June, its lowest level in months, although core inflation fell only marginally to 4.12%, remaining above the target range, which explains the central bank’s caution. Economic activity, meanwhile, remains below its potential, while the Mexican Stock Exchange fell 2.36% for the month. The Mexican peso stood at 17.49 pesos per dollar, appreciating 2.89% year-to-date and supported by a strong trade balance and foreign direct investment inflows.

Overall, June was a month of consolidation following a largely positive first half of the year. The favorable outcome on the energy front represents a significant deflationary relief, but the market has had to recalibrate its expectations in light of a Federal Reserve determined to prioritize inflation control over growth stimulus. In this environment of greater volatility and sensitivity to interest rates, a disciplined and selective approach, with an emphasis on the quality of fundamentals, remains the most appropriate strategy.