The stock market continued its bullish upward climb in June, making the first half of the year positive for all major equity indices.  The magnitude of increase varied by market cap, style, sector, and location.  We are enjoying the journey upward while watching for possible downside and even a potential bear market.  Thankfully, currently no bears are in sight.  

This year the markets have yet to experience the seasonal slower summer trading days referred to as the summer doldrums.  As institutional traders and investors head to the Hamptons and elsewhere, this is normally a good time to escape the Texas summer heat, at least for a while, as many investors and clients are doing the same.  This year, a quick trip was made to the mountains visiting Jackson Hole and the majestic Grand Teton National Park for some hiking, rest, and relaxation. 

On two different hikes and one bike outing, others on the trails cautioned that bears were nearby.  One of which was a grizzly, while the other two were believed to be black bears with baby cubs.  In all three instances, we came along within 2 - 20 minutes of the latest bear sightings within 50 – 60 yards of the trails, without experiencing the bears ourselves.  In fact, had we not been told of the bears, we would have never known they were nearby.  Although we did not see the bears, we attentively watched, called out around each corner to let them know we were in the area, and we carried bear spray – just in case.  Basically, we went on with our hike upward, and took precautions, while being aware of possible bears in the area.

Loving capitalism and the markets, perhaps as much as the mountains, cool clean air, and magnificent scenery, it is easy to see similarities in investing and hiking.  Like the trails that head upward, there is the potential for washouts, diversions, and even bears along the way.  As the markets continue to climb upward, there are possible events that could cause pullbacks.  Potential concerns involve monetary and fiscal policies, money supply, interest rates, high inflation, softening GDP, political and geopolitical issues, changes in traditional free markets, etc...

An up-close encounter with a bear - on a hike or in the markets, is no joke.  This is why it's prudent to look through the noise and focus on the fundamentals of corporate earnings and the multiple investors are willing to pay for those earnings.  Just as one takes precautions when hiking, one does the same with potential bear markets by confirming risk tolerance, setting cash flow ladders aside, diversifying one's portfolio, and using asset allocation to participate in the upside, but also to prepare for the unknowns.  As always, we want to update and confirm one's personal outlook on each of these important issues.

With equity markets currently trading slightly above their longer-range averages, pullbacks are certainly possible.  After all, historically, the mean average intra-year pullback per calendar year is nearly 15%.  Yet corporate earnings and margins are strong.  In fact, barring an exogenous black-swan event, or geopolitical happening, no bear sightings are currently lurking around the bend.  In fact, according to the most recent FactSet update, the street consensus outlook calls for a nearly 20% increase in the S&P 500 over the next 12-months, using bottom-up consensus numbers.  Even so, markets rarely move straight upward or downward.

Second quarter earnings season is soon to kick off.  All eyes will be focusing on continued strength and any potential weakness in the numbers.  Should conditions or outlook change, we will be in touch.  Until then, we'll plan for the markets to move along, while watching for potential bears.

Regardless, all-in-all, equity investors celebrated the first half of 2026 with increasing corporate earnings and record high stock prices, at the same time we celebrate our country's founding!  The markets are well positioned to potentially experience further upside.  

Whether hiking, or enjoying time at the beach, or simply spending time with family and loved ones, we hope your Fourth was meaningful and fun!  We remain forever thankful to live in the land of the free and the home of the brave, and to work with clients and friends who entrust us with their life savings.  We are indeed blessed and grateful for the opportunity!  Here, if you need anything.  

_{Not an offer or Advice: This commentary is provided for informational and educational purposes only and does not constitute a recommendation to buy or sell any specific security or to adopt any particular investment strategy. The views expressed represent the current opinions of Joyce Wealth Management as of 7/7/26 and are subject to change without notice.}