Monthly Economic and Market Summary

• U.S. Equities Reach Record Highs—U.S. equities posted strong gains in the second quarter, with both the S&P 500 and Nasdaq Composite reaching record closing highs. The market rebound erased losses from the April downturn, which had brought the S&P 500 near bear market territory. The index delivered its strongest quarterly performance since December 2023.
• New Grads Struggle to Find Jobs—Recent college graduates are encountering increased difficulty securing full-time employment, despite strong academic credentials and professional networks. The unemployment rate for individuals aged 22–27 with college degrees has risen to 5.8%, the highest level in approximately four years. Contributing factors include reduced hiring activity and the adoption of artificial intelligence in place of certain entry-level roles.
• Fed Officials Hold Rates—The Federal Reserve held interest rates steady for a fourth straight meeting, with policymakers divided on the outlook for interest rates and inflation. Federal Reserve Chair Jerome Powell signaled that recent tariff measures are expected to place upward pressure on prices, though the extent to which these costs will be absorbed by consumers remains uncertain.
• U.S. Dollar Selloff—The ICE U.S. Dollar Index is on track for its worst first-half performance since 1973, declining over 10% in the past six months. The depreciation of the dollar carries significant implications for the global economy, given its central role in international trade and finance.
• U.S. Consumer Confidence Drops—U.S. consumer confidence declined unexpectedly in June, with the Conference Board’s confidence index falling 5.4 points to 93. The decline reflects growing concerns over the potential economic impact of increased import tariffs and a weakening labor market outlook. The expectations index, which gauges consumers’ outlook over the next six months, declined 4.6 points, signaling cautious sentiment around household spending.

AI Driven Energy Demand

Global energy demand is set to rise significantly, driven by the modernization of developing economies and the rapidly growing need for electricity to power artificial intelligence (AI). The growth is being fueled by AI’s insatiable appetite for computing power. Training sophisticated AI models demands immense computing power. Data centers require a constant power supply to function for users creating an “always on” demand for energy. According to Goldman Sachs, data center power demand is projected to surge 165% by 2030.The United States will account for nearly half of this increase, as tech giants accelerate their AI development, requiring vast amounts of resources to process and store massive datasets.

This unprecedented demand is prompting utilities to overhaul long-term energy strategies. To meet future demand, they are investing in new generation capacity and expediting grid upgrades. For instance, utilities are expanding natural gas generation, restarting dormant facilities and exploring innovative solutions such as small modular nuclear reactors, renewable energy sources and large-scale battery storage to ensure a reliable sustainable energy supply.

AI is driving real capital investment and tech companies are forging strategic partnerships with leading energy and utility producers. Notably, Meta Platforms and Microsoft have signed agreements with Constellation Energy to access emissions-free nuclear energy, underscoring the industry's shift toward sustainable power sources to support AI-driven growth. The AI-driven energy demand highlights the need for innovative, sustainable solutions to power the future of technology.