Market Commentary - Prime Buchholz

July 2024 Monthly Market Review

Markets experienced significant shifts across various asset classes in July. Small cap equities outperformed large cap stocks, driven by lower-than-expected inflation data that spurred expectations of a Federal Reserve rate cut in September. The Russell 2000 Index gained 10.2%, significantly outpacing the S&P 500. Interest rate-sensitive sectors such as real estate, financials, and utilities posted strong gains, while growth sectors like communication services and IT saw declines.

Market Perspectives, Year-End Reviews

2024 Fiscal Year Review

Fiscal Year 2024 proved to be a strong year, with double-digit gains of approximately 10% for a diversified portfolio, building off of gains of more than 11% in the previous fiscal year. Like the previous period, global equities experienced a robust rally in FY 2024 and were the main driver of returns. This was notable… Read more »

Market Updates

May 2024 Monthly Market Review

Global equity markets experienced a strong rebound in May, particularly in the U.S. and tech sectors. Growth stocks outperformed value stocks, with significant gains in technology, driven by robust performances from NVIDIA and Apple. Declining interest rates benefited both the utilities and real estate sectors, while the energy sector struggled due to falling crude prices.

Market Updates

April 2024 Monthly Market Review

Following a five-month streak of gains, global equity markets experienced a downturn in April. The S&P 500 and Russell 3000 Index each fell by more than 4%. Large caps slightly outperformed small caps, and defensive sectors like utilities showed resilience. The decline in equity values was largely due to a compression in the S&P 500’s forward earnings multiple. Despite the downturn, corporate fundamentals remained robust with 77% of reporting companies beating estimates. Internationally, developed markets dipped, but emerging markets (EM), led by strong performance in China, recorded gains. Fixed income markets saw a rise in yields, affecting bond prices, while real assets had mixed outcomes with natural resource sectors gaining amid higher natural gas prices and industrial metals benefiting from tariff hikes. Overall, the month was marked by significant movements in both equity and fixed income markets, influenced by macroeconomic factors and shifting investor sentiment.

Investment Perspective: China at a Crossroads

China stands at a critical juncture, mired in one of its most severe market downturns since the nation’s equity market reopened in 1990. After reaching a near 30-year high in early 2021, the MSCI China Index fell nearly 60% over the following three years. In early 2021, a series of events negatively impacted Chinese markets,… Read more »

Market Updates

March 2024 Monthly Market Review

Domestic equity markets saw their fifth consecutive month of gains, with the S&P 500 and Russell 3000 indices each up by 3.2%. NVIDIA led domestic equity gains with a 14.2% increase, but overall, sectors like consumer discretionary and IT underperformed, influenced by declines in Apple and Tesla. In contrast, the energy, utilities, and materials sectors excelled due to investor rotation towards real assets. Despite a robust year-to-date market performance, S&P 500 earnings growth expectations were revised downward. Internationally, developed and emerging markets also enjoyed gains, with notable performance in tech sectors due to rising AI demand. The Bank of Japan ended its long-standing negative interest rate and yield curve control policies, causing significant currency dynamics. Fixed income remained steady, while real assets, especially in the energy sector, benefited from higher oil prices and geopolitical tensions, contributing positively to market dynamics.

Market Updates

February 2024 Monthly Market Review

In February, economic data surpassed expectations, leading to a reevaluation of policy rates and generally declining fixed income values. Meanwhile, persistent enthusiasm for artificial intelligence (AI) and robust corporate fundamentals drove significant gains in domestic equity markets, particularly by AI-related sectors like semi-conductors. Non-U.S. equities also performed well, especially in Japan and China, despite uncertainty… Read more »

Investment Perspective: A Return to Irrational Exuberance?

Based on the S&P surpassing the 5,000 milestone and reaching all-time highs, inflation subsiding, and the U.S. economy appearing on the path to a soft landing, there are reasons to be optimistic about the market outlook. However, investor sentiment appears to be stretched and a shakeout of speculative pockets could occur. We also note that the potential risks posed by geopolitical instability and stress in commercial real estate are considerable and must be continually monitored. The recent rally could be an opportunity to trim equity exposure on strength in portfolios that are approaching the high end of their policy ranges.

Market Updates

January 2024 Monthly Market Review

Global equity markets experienced sustained positive momentum in January, with domestic equity markets posting gains and the S&P 500 achieving all-time highs. However, concerns about increased market volatility and cautious Federal Reserve indications regarding delayed interest rate cuts could temper investor sentiment.

Investment Perspective: The Outlook for Monetary Policy

In this investment perspective, we evaluate the current environment through the lens of the Fed’s dual mandate and attempt to reconcile the start date of when the easing cycle may begin.

Market Updates, Year-End Reviews

December 2023 Year-End Review

Global financial markets in 2023 were defined by volatility as investors navigated the effects of inflation, geopolitical tensions, policy decisions, post-pandemic consumer trends, and the utter domination of the “Magnificent Seven” stocks. Many believed that the U.S. economy would enter a recession in 2023 but the consumer proved to be resilient and government spending on… Read more »

Market Updates

November 2023 Monthly Market Review

Domestic equities surged in November following strong economic data, benign inflation, and robust corporate earnings. Overseas equities, particularly in the euro area, followed suit. In fixed income, bond markets rallied on optimism about inflation trends and a potential Fed pivot, resulting in falling yields. Credit investments benefited from narrowing spreads, with investment-grade and high yield sectors gaining. Real assets, including global REITs and infrastructure, delivered positive returns, while oil prices declined due to record U.S. production and weaker Chinese demand. Clean energy rebounded, and gold rose as a hedge against geopolitical uncertainty.

Market Updates

October 2023 Monthly Market Review

Domestic equity markets experienced a sell-off during October due to concerns about higher interest rates. However, corporate fundamentals remained strong, with many S&P 500 companies beating earnings expectations. Developed non-U.S. equities also declined, particularly in Europe and Japan, but there was optimism about cooling inflation. Emerging markets equities faced headwinds, especially in China, due to… Read more »

Investment Perspective: Commercial Real Estate – Where Do We Go From Here?

Stress & Distress A steady stream of headlines highlighting distressed CRE assets and landlords paint a grim outlook for the asset class. Stress and distress emerged in the office space sector, as post-pandemic work-from-home trends have altered the demand for office space, resulting in climbing vacancy rates. This has dislocated the sector and initiated a… Read more »

Market Updates

September 2023 Monthly Market Review

Financial markets were marked by turbulence in September due to concerns about Treasury issuance and deficits. Domestic equities fell amid fears of an economic slowdown and higher interest rates, and international markets followed suit. Clean energy and global real estate struggled due to negative sentiment, while some emerging markets performed well. Short sellers and distressed… Read more »

Market Updates

July 2023 Monthly Market Review

Risk assets delivered positive returns in July. U.S. equities rose 3.6%, while non-U.S. developed and emerging markets (EM) equities gained 3.2% and 6.2%, respectively. The price of oil rose and other commodities—from agriculture to industrial metals—also rallied, which helped drive real asset categories higher. With inflationary pressures easing and investors believing global central banks are… Read more »

Market Updates

June 2023 Monthly Market Review

Despite ongoing concerns about the prospects for global growth, risk assets delivered positive results in June. U.S. equities continued to rally with a notable broadening of contributors to returns compared to May. Non-U.S. equities, both in developed and developing markets, also posted gains and benefited from a weaker U.S. dollar (USD). Fixed income markets were… Read more »

Jared Fuller Discusses Mission Aligned Investing Live on Nasdaq

Prime Buchholz Principal and Co-Head of Research Jared Fuller recently sat down with Adriana Ballard, Director of Nasdaq Asset Owner Solutions, to discuss how mission investors are aligning their portfolios with their unique goals. See the full video here.

Market Updates

May 2023 Monthly Market Review

Global risk assets posted mixed results in May. U.S. equities climbed a wall of worry—the ongoing debt ceiling debate, monetary policy uncertainty and global growth concerns—and finished the month higher, boosted by a narrow group of tech-related stocks. In contrast, international developed and emerging markets (EM) equities declined due to the lack of tech stock… Read more »

Market Updates

April 2023 Monthly Market Review

Risk assets benefited investors in April despite several concerning trends, including stress in the banking sector, the risk of U.S. default due to the debt ceiling impasse, slowing GDP growth, and the increasing chance of a recession. Although the Fed’s tightening cycle is widely expected to end following one more 25 bps hike in May,… Read more »

Market Updates

March 2023 Monthly Market Review

Risk assets were mixed but generally positive during March despite stress in the financial system caused by the collapse of three U.S. banks. Concerns about depository institution solvency first spread among U.S. regional banks and then among major European institutions, particularly in Switzerland. U.S. and Swiss authorities quickly adopted plans aimed at preventing further damage… Read more »

Market Updates

February 2023 Monthly Market Review

Investor exuberance did not carry over from January to February, as markets were met with a dose of reality related to central bank policy and geopolitical risks. A strong January labor report and reaccelerated inflation caused markets to reassess the path of interest rates. Despite Fed rhetoric to the contrary, traders expected an easing cycle… Read more »

Market Updates

January 2023 Monthly Market Review

Risk appetite remained elevated in January, with returns across many asset classes building from gains achieved in the fourth quarter of 2022. Global equity markets rallied in January with roughly similar gains—in local currency terms—across the U.S. and developed non-U.S. markets. Taking into consideration a weak U.S. dollar, the U.S. lagged. Emerging markets (EM) equities… Read more »

Market Updates, Year-End Reviews

2022 Year-End Review

Global inflationary pressure and hawkish central banks were two pervasive and profound themes of 2022. Inflation proved to not be transitory and reached levels not seen in nearly four decades. As a result, central banks around the globe were forced to remove policy accommodation and tighten financial conditions to get inflation back to an acceptable… Read more »

Market Updates

November Monthly Market Review

Capital markets rallied in November, with gains achieved across both risk-free and risk assets. Interest rates were volatile during the month, but the bond market reacted favorably to a weaker-than-expected CPI report released November 10th and to Fed Chair Jerome Powell’s perceived dovish comments on November 30th. In fact, those two factors contributed to a… Read more »

Market Updates

October 2022 Monthly Market Review

Aside from weakness in emerging markets (EM) equities, October was positive for risk assets. U.S. and international developed equity markets delivered mid- to high-single-digit returns despite the persistence of concerning factors such as geopolitical risk (war in Ukraine, turmoil in the U.K, authoritarianism), aggressive central bank tightening, and ongoing global inflationary pressures.

Market Updates

September 2022 Monthly Market Review

Negative investor sentiment extended throughout September with precious few places to shelter outside of cash and the U.S. dollar. Despite investors’ ongoing search for signs of peak inflation, the August consumer price index (CPI) print (and corresponding inflation prints around the globe) were higher than expected. This cemented a fourth consecutive 75 bps rate hike… Read more »

Market Updates

August 2022 Monthly Market Review

The relief felt by markets in July proved momentary, as August provided few sources of positive returns. The month started similarly to how July ended; however, sentiment shifted following the release of the minutes from the July Federal Open Market Committee (FOMC) meeting, where participants “agreed that there was little evidence to date that inflation… Read more »

Market Updates

July 2022 Monthly Market Review

Intensifying inflationary pressures cast an ominous cloud over the economy in July despite positive gains across many capital markets. In addition to waning business confidence, consumer confidence neared all-time lows as recession fears grew. The Bureau of Economic Analysis’ advanced second quarter GDP estimate showed a −0.9% annualized growth rate, which, when combined with a… Read more »

Market Updates

June 2022 Monthly Market Review

June was a difficult month for public markets. While investors remained concerned about inflation and geopolitical risks, fears began to grow regarding a downturn in the business cycle. Even though economic data released during the month was weaker than expected, the Fed remained hawkish and steadfast in its tightening cycle. The Federal Open Market Committee… Read more »

Market Updates

May 2022 Monthly Market Review

Performance was mixed across asset classes during May. A late-month rally helped U.S. equities avoid meeting the technical definition of a bear market, but it still only yielded returns that ranged from slightly negative to slightly positive. Currency moves proved to be a tailwind for non-U.S. equity markets. However, in local currency terms, there was… Read more »

Market Updates

April 2022 Monthly Market Review

Risk aversion spiked in April despite a lack of meaningful change in variables including geopolitical events, inflation, and hawkish central banks. Russia’s offensive against Ukraine raged on, and in spite of heavy sanctions, the former continued to avoid a debt default. During the month, Russia halted gas exports to Poland and Bulgaria—perhaps in an opening… Read more »

Market Updates

March 2022 Monthly Market Review

March marked one full month since Russia invaded Ukraine. The war continued to cause international outrage as Russia left carnage and a significant humanitarian crisis in its wake. We remain hopeful a peaceful resolution will be reached soon. Although sanctions have expanded and Russian citizens are feeling pain, markets remain wary that Putin could wage… Read more »

Market Perspectives, Market Updates

Markets React to Russia’s Invasion of Ukraine

We stand with the countless world leaders who have expressed outrage and condemned the attacks. We hope for a swift, peaceful conclusion that results in no further loss of life or liberty for the Ukrainian people. While markets have been reacting to escalating tensions in the region for a number of months, they responded sharply this week as the worst fears became realized.

Market Updates

February 2022 Monthly Market Review

Russia’s invasion of Ukraine dominated headlines and capital markets during February. Even before the month started, investors were concerned about elevated geopolitical risk and the potential impact on inflationary pressures around the globe. Unfortunately, the worst case scenario materialized, with Russia launching a full scale war on February 24th. Markets reacted by going into risk-off… Read more »

Market Updates

January 2022 Monthly Market Review

The stock market in January was a prime example of how rising fears can lead to heightened risk aversion and hurt performance for most assets classes.

Markets Fluctuate as the Fed Pivots

Volatility Rings in the New Year It was a tumultuous first month of the year, as rising inflation and a shift in the Fed’s monetary policy stance caused extreme volatility across most markets. In the wake of strong market performance to end 2021—predominantly attributable to the strength of mega cap stocks—losses within equities have been… Read more »

Market Updates, Year-End Reviews

2021 Year-End Review

The global pandemic entered its second year in 2021. Despite the rapid rollout of several vaccines at the end of 2020 and concerted efforts to immunize the population, vaccination rates vary widely across the globe. Two variants of the original SARS-CoV-2 strain emerged—delta and omicron—and spread quickly across the world. When infection rates spiked at… Read more »

Market Updates

October 2021 Monthly Market Review

Equity markets shrugged off several lingering concerns during October, including disrupted supply chains, elevated inflation, and stalled global growth. Fears about growth seemed to intensify following weaker than expected third quarter GDP reports in the U.S. and Germany, as well as ongoing challenges in China. Markets also grappled with the prospect of less monetary policy… Read more »

Market Updates

September 2021 Monthly Market Review

September was a difficult month for markets as slowing global growth from a debt overhang in China, ongoing supply chain issues, and persistent inflation sparked fears of stagflation. This comes at a time when many global central banks have reduced or are considering reducing monetary support, notably the tapering of quantitative easing in the U.S…. Read more »

Market Updates

August 2021 Monthly Market Review

Global equities were resilient during August despite the rapid spread of the Delta variant, mixed economic data, and hints of a potential shift in Federal Reserve policy. U.S. equity markets—financials, communications, and technology in particular—outpaced international developed market equities in both local terms and, due to strength in the U.S. dollar (USD), in unhedged terms… Read more »

Market Updates

July 2021 Monthly Market Review

Investor attention turned to China in July as a spike in regulatory activity had a profound impact on equity returns that reverberated across much of Asia. Chinese technology, internet, and ecommerce names had already been under pressure due to probes into a host of prominent companies in the space since the Ant Group IPO was… Read more »

Market Updates

June 2021 Monthly Market Review

June delivered a mixed—but overall positive—month for capital market returns. Although accommodative monetary and fiscal policy remained in place, growing gridlock in the U.S. Congress and perceptions of a more hawkish Federal Reserve stoked uncertainty. Inflation expectations moderated in June despite a large increase in energy prices. However, some market participants see a possibility for… Read more »

Market Updates

May 2021 Monthly Market Review

The first CPI release with the ominous base effect was reported in May. On a year-over-year basis, consumer prices rose 4.2% in April and core prices, which exclude the often-volatile food and energy categories, rose 3.0%. Results were higher than markets expected, which led to some unusual market dynamics in May. Gold, as well as… Read more »

Market Updates

April 2021 Monthly Market Review

The Biden administration announced additional fiscal stimulus in April. After signing the $1.9 trillion ARPA of 2021 and announcing a $2.0 trillion infrastructure plan in March, a new $1.8 trillion package—called the American Families Plan (AFP)—was unveiled by President Biden at his first speech before a joint session of Congress. The AFP would be funded… Read more »

Market Updates

February 2021 Monthly Market Review

Risk assets performed well in February but waned as the month came to a close. Optimism about an improving economy continued to grow as Democrats worked to push through a $1.9 trillion stimulus package and the COVID-19 vaccine efforts built momentum as a third vaccine option was added. Inflation expectations—as measured by the difference between… Read more »

Market Updates

January 2021 Monthly Market Review

The optimism that drove markets in December waned in the first month of the new year. In the first full week of January, the joint session of Congress to certify the results of the electoral college—typically a ceremonial process—was marred by violent protests and riots. Undeterred, Congress reconvened after rioters were cleared from the Capitol… Read more »

Market Perspectives, Market Updates

Reddit vs. the Hedge Funds: Anatomy of a Squeeze

The start of 2021 marked a sharp increase in speculative trading. Video game retailer GameStop has been the poster child for this mania, gaining over 1,700% from year-end through January 27th, before falling sharply on January 28th—fueled by Reddit’s r/WallStreetBets community. Year-to-date (YTD) through January 27th, the Goldman Sachs “Highest Short Interest” basket gained 52.1%. … Read more »

2020 Year-End Review

The year 2020 will be remembered as one of the most challenging in human history. Before we begin our review of the financial markets, we need to acknowledge the previously unimaginable impact of the virus. COVID-19 has infected more than 88 million people in 191 countries, which has led to the deaths of nearly 2… Read more »

Chaotic Start to the New Year

The start of a new year is always exciting; full of wonder and new beginnings. That is, of course, unless the first few days feel like a continuation of the previous year… and the previous year was 2020. In the midst of record rates of COVID-19 infections and deaths, the first week of 2021 was… Read more »

Market Updates

November 2020 Monthly Market Review

Risk assets rallied in November, with the S&P 500 reaching all-time highs and the Dow Jones Industrial Average piercing the 30,000 level for the first time in its history. Several different pharmaceutical and biotech companies announced positive results from COVID-19 vaccine trials, which helped stoke optimism. After failing to secure the Democratic nomination in 1988… Read more »

Market Updates, Uncategorized

October 2020 Monthly Market Review

October was characterized by the push and pull between optimism and reality. Risk assets such as emerging markets (EM) equities, EM debt, and high yield bonds delivered positive results as investors sought to look beyond a post-U.S. election and post-pandemic world. U.S. bond yields rose, putting pressure on Treasuries, as markets appeared to expect some… Read more »

Market Updates

September 2020 Monthly Market Review

Special purpose acquisition companies (SPACs) remained in high demand in September as investors sought new ways to participate in a changing landscape for merger and acquisition (M&A) transactions and IPOs. Outside of SPACs, however, risk appetite waned across markets. Global equity markets declined, with the U.S. equities trailing both developed international and emerging markets (EM)… Read more »

Market Updates

August 2020 Monthly Market Review

Investor optimism remained elevated in August, leading to weak performance of safe assets and another month of positive returns across risk assets. Safe investments such as global sovereign bonds sold off as yields rose and curves steepened. The U.S. dollar weakened against most currencies. In contrast, global equity markets rallied, led once again by the… Read more »

Market Updates, Year-End Reviews

2010–2019: A Snapshot of the Decade

As we turn the page on a new decade, we note the following key trends from the past 10 years: U.S. equities were the dominant asset class over the last 10 years, meaningfully outperforming non-U.S. developed and EM equities. However, the prior decade was a stark contrast as U.S. equities fell 0.9% and EM equity… Read more »

Market Updates

January 2020 Monthly Market Review

Investor sentiment remained positive in the early weeks of January as the broad gains experienced in 2019 carried over into the new year. However, equity markets peaked around January 17th after a second death was reported in Wuhan, China―the epicenter of the coronavirus outbreak. The virus spread to other countries and by the end of… Read more »

Market Updates, Year-End Reviews

2019 Year-End Review

Bullish investor sentiment prevailed over the course of 2019 despite geopolitical uncertainty and periodic bouts of market volatility. The resumption of accommodative monetary policy was a key driver of waning risk aversion. After previously indicating it would hold policy rates steady in 2019, the Fed pivoted and cut rates during the second half of the… Read more »

Market Updates

November 2019 Monthly Market Review

Public comments by Federal Reserve members in November further signaled the likelihood of a pause in the current easing cycle, but also confirmed that policymakers are prepared to take the steps necessary to extend the economic expansion. This guidance impacted both rate and currency markets. Rates in the U.S. and abroad rose, and the U.S…. Read more »

Market Updates

October 2019 Monthly Market Review

Equity markets continued to climb in October, with broad-based gains across most regions and sectors. The S&P 500 hit another all-time high amid positive corporate earnings trends and another policy rate cut by the Fed. In a reversal from the previous month, domestic growth stocks regained market leadership and have sharply outpaced value stocks over… Read more »

Market Updates

September 2019 Monthly Market Review

Equities posted broad-based gains in September, halting the late summer decline. In a trend reversal, value stocks outpaced their growth counterparts across regions for the month. September marked the second month in 2019 when value beat growth. However, growth stocks remained solidly ahead of value stocks across all regions on year-to-date basis. Yields rose for… Read more »

Market Updates

August 2019 Monthly Market Review

August ushered in a shift in investor sentiment that put downward pressure on risk assets and sparked a flight to safety, which manifested in both the interest rate and currency markets. U.S. equities fell 2% but outpaced the local returns of both international (–2.4%) and emerging markets (EM) equities (–2.5%). Global trade tensions and negative… Read more »

Market Updates

July 2019 Monthly Market Review

July saw the trend of positive returns across most asset classes continue, but there was some dispersion. Central bank activity continued to take center stage. The Fed cut rates by 0.25% during the month, effectively unwinding its rate hike from December 2018. At the meeting, the Fed also decided to end balance sheet reduction effective… Read more »

Market Updates

June 2019 Monthly Market Review

The first half of 2019 ended with a rebound in risk asset performance. Virtually every equity market delivered positive performance in June, including record gains in U.S. equity markets. While uncertainty with regard to trade remains, some positive developments emerged during the month. Perhaps the most significant driver of performance stemmed from dovish guidance by… Read more »

Market Updates

May 2019 Monthly Market Review

After a strong start to 2019, market sentiment shifted dramatically in May as virtually every equity market posted sharp declines. Ongoing uncertainty around trade discussions with China served as a significant headwind. Concerns heightened further with the surprise announcement that the U.S. will place escalating tariffs on Mexico if the country does not take steps… Read more »

Market Updates

April 2019 Monthly Market Review

Risk aversion declined further in April, helping equities continue to deliver broad gains following the confirmation of the Fed’s dovish stance. Other central banks followed suit in April and became more dovish which also improved investor sentiment. The Federal Open Market Committee’s April meeting was held on the last day of the month. While the… Read more »

Market Updates

March 2019 Monthly Market Review

Equities continued to post broad gains in March as the Fed’s dovish tilt became more pronounced with guidance suggesting no further hikes in 2019. Equity investors embraced the potential end to the rate hiking cycle and interest rates fell across the U.S yield curve. The S&P 500 rose by 1.9% for the month. Following the… Read more »

Market Updates

February 2019 Monthly Market Review

Risk assets delivered strong performance in February. Sentiment remained positive as clarity regarding future U.S. policy rates and a potential end to the balance sheet roll-off emerged with the apparent Fed shift to a more dovish stance. Meanwhile, some progress was made in trade negotiations between the U.S. and China during the month. In light… Read more »

Market Updates

January 2019 Monthly Market Review

Some of the concerns that led to heightened volatility in December appeared to abate at the start of 2019. The U.S. government shutdown ended with Congress passing a continuing resolution that lasts until mid-February. Strong fourth quarter earnings reports in the U.S. also supported equity markets. Lastly, the Federal Reserve held policy rates steady and… Read more »

2018 Year-End Review

Capital markets experienced heightened volatility toward the end of 2018 as investor sentiment shifted. Concerns over global growth, ongoing trade wars, higher U.S. interest rates, and corporate profit trends resulted in a sharp sell-off of many risk assets as the fourth quarter unfolded. U.S. equities posted gains for most of the year, with the Russell… Read more »

Market Perspectives, Market Updates

November 2018 Monthly Market Review

November markets generally rallied, despite global trade tension and growth worries remaining prominent concerns. Longer-term yields declined, which boosted performance for U.S. Treasuries, income-generating equities, and select areas of REITs. Global equity markets rose, and although volatility fluctuated during the month, it never reached the peaks seen in October. While the U.S. dollar (USD) rose… Read more »

Market Perspectives, Market Updates

October 2018 Monthly Market Review

Rising U.S. interest rates, ongoing global trade tension, and country-specific geopolitical issues contributed to a sharp shift in investor sentiment during October. Global equity markets sold off sharply while volatility grew considerably. Weakness was widespread and many equity markets hit correction territory. Equity volatility rose sharply since the prior month-end. In a reversal of recent… Read more »

Market Perspectives, Market Updates

September 2018 Monthly Market Review

U.S. equities continued to set records in September, despite rising interest rates and ongoing uncertainty regarding global trade policy. Emerging markets (EM) equity fell sharply at the beginning of the month on concerns about these themes; they rallied in the second half of the month. Despite a poor start, the Brazilian real, Russian ruble, and… Read more »

Market Perspectives, Market Updates

August 2018 Monthly Market Review

U.S. equity markets continued their run of solid performance in August amid the tailwind of strong second quarter earnings reports. However, there was significant dispersion across capital markets, with geopolitical risks, macroeconomic volatility, and a flight to quality driving the U.S. dollar (USD) higher and most non-U.S equity markets lower. There were some concerns regarding… Read more »

Market Perspectives, Market Updates

July 2018 Monthly Market Review

Economic indicators showed signs of continued improvement in the U.S. After rising sharply in the second quarter, the Dollar Spot Index retreated modestly as the U.S. dollar fell against most currencies. The U.K pound and the Japanese yen were two notable exceptions. U.S. Treasury yields continued to move higher on the back of improving economic… Read more »

Market Perspectives, Market Updates

June 2018 Monthly Market Review

Trade war rhetoric continued to escalate during June and had a meaningful impact on financial markets. Oil prices surged—hitting a three-and-a-half-year high late in the month. The Federal Reserve elected to increase policy rates yet again, and signaled the likelihood of four total hikes in 2018. These factors contributed to movement in the currency markets,… Read more »

Market Perspectives, Market Updates

May 2018 Monthly Market Review

U.S. equities posted positive returns in May. However, equity results were mixed across the globe following the rise of several geopolitical risks. These include a fiery presidential campaign in Mexico, fears that Turkey may lessen central bank independence, and heightened concerns of growing populist pressures in Europe. Trade policy initiatives once again spurred uncertainty. The… Read more »

Market Perspectives, Market Updates

April 2018 Monthly Market Review

The decline in risk assets subsided in April and U.S. equity market volatility fell from elevated levels exhibited in recent months. Earnings reports in the U.S. were generally positive, with more than 80% of companies in the S&P 500 exceeding expectations thus far in the first quarter reporting cycle, which Bloomberg reported as an all-time… Read more »

Market Perspectives, Market Updates

March 2018 Monthly Market Review

Most equity markets fell in March and volatility remained elevated. Information technology (IT) stocks declined sharply, but remained the top performing sector in the S&P 500 on a year-to-date basis. Unlike February, dispersion was high as some sectors posted positive results amid the broad equity market sell-off. Longer-term U.S. interest rates fell, reversing some of… Read more »

Market Perspectives, Market Updates

February 2018 Monthly Market Review

Despite a favorable macroeconomic backdrop, global equity markets experienced a sharp pullback in early February and equity market volatility rose sharply. After several years at muted levels, domestic equity volatility, as measured by the VIX, hit its highest level since August 2015 as leverage was being forced out of the market and risk aversion was… Read more »

Market Perspectives, Market Updates

January 2018 Monthly Market Review

Risk assets started 2018 strong with global equities building on gains from 2017. Investors embraced the enactment of U.S. tax reform and optimism rose regarding improving economic activity in Europe and a generally favorable backdrop for global growth. In this environment, merger and acquisition activity was robust to start the year despite high valuations. For… Read more »

Market Updates, Year-End Reviews

2017 Year-End Review

Investors enjoyed a second consecutive calendar year of strong capital market gains, with global equity markets continuing the bull market. Contributing factors included stronger economic data, accelerating earnings growth, and relatively loose monetary policy despite the Fed’s move toward increasing policy rates and tapering asset purchases. The domestic political climate remained contentious in 2017. Even… Read more »

Market Perspectives, Market Updates

November 2017 Monthly Market Review

Weakness in the U.S. dollar (USD) during November provided a tailwind for global equity markets, which built upon gains achieved in October. However, there was notable dispersion among local equity market returns, with strong gains in the U.S. and several Asian markets but declines across the U.K and Europe. Despite broad equity market gains, November… Read more »

Market Perspectives, Market Updates

October 2017 Monthly Market Review

Equity market gains were broad-based in October, driven by rising optimism regarding tax stimulus and recent favorable corporate earnings trends. Technology was a positive contributor across regional equity indices on the heels of further gains from several mega cap stocks. The U.S. dollar rallied, but local equity market strength outweighed the currency headwind in most… Read more »

Market Perspectives, Market Updates

September 2017 Monthly Market Review

Most risk assets performed well in September, with the markets embracing potential domestic tax reforms and economic releases reflecting mostly positive indicators toward the end of the month. The Federal Reserve also announced plans to taper bond purchases, indicating confidence in the economic recovery. Small cap stocks outperformed their larger counterparts by a wide margin… Read more »

Market Perspectives, Market Updates

August 2017 Monthly Market Review

While most equity markets enjoyed another positive month in August, these gains masked greater uncertainty and increased geopolitical tensions. In the last week of the month, North Korea fired several ballistic missiles into the East Sea and over Japan, which sparked a rally in interest rates and precious metals as investors sought safe-haven assets. While… Read more »

Market Perspectives, Market Updates

July 2017 Monthly Market Review

July was another strong month for risk assets amid ample central bank liquidity, stable economic growth, and strong U.S. corporate earnings results. The environment not only supported global equities, but several marketable real asset categories and below-investment-grade credit as well. Domestically, equity markets continued to exhibit low volatility and the VIX hit a multi-decade low… Read more »

Fiscal Year-End Reviews

2017 Fiscal Year-End Review

Fiscal year 2017 began with lingering uncertainty caused by a rising tide of populism, notably the Brexit referendum vote that closed out fiscal year 2016. Rooted in global trade-related economic inequality, a desire to control borders, and national security concerns, populism helped Donald Trump win the U.S. presidential election in November and was a dominant… Read more »

Market Perspectives, Market Updates

January 2017 Monthly Market Review

The market continues to assess the potential impact of President Donald Trump’s policy initiatives. A few key trends from late 2016 reversed during January, broadly impacting the capital markets. After rising post-election, the U.S. dollar (USD) fell relative to many foreign currencies, providing a tailwind for U.S. investors’ allocations abroad. U.S. Treasury yields stabilized as… Read more »

Market Updates, Year-End Reviews

2016 Year-End Review

At the outset, 2016 was underscored by sharp declines in many risk assets amid concerns over global growth, continued oil price weakness, and the pace of slowing growth in China. Through February 11th, the S&P 500 was down 10.3% year-to-date and U.S. Treasury yields out the curve had fallen significantly as investors sought safe havens. … Read more »

Market Perspectives, Market Updates

November 2016 Monthly Market Review

Donald Trump’s unexpected victory in the U.S. Presidential election had a significant, immediate, and broad impact across the capital markets. It is unclear precisely how policies will change under Trump’s leadership and whether he will be able to fully implement the plans he discussed during the campaign. However, at this stage, the market appears to… Read more »

Market Perspectives, Market Updates

October 2016 Monthly Market Review

Risk asset performance was mixed in October, after largely exhibiting gains in September. Outside of positive returns in financials, U.S. equities were broadly lower, led by meaningful weakness in health care and real estate. U.S. equities underperformed their international counterparts which produced positive local returns. However, currency was a significant headwind as the U.S. dollar… Read more »

Market Perspectives, Market Updates

September 2016 Monthly Market Review

Most risk assets posted positive absolute returns in September, as large central banks remained accommodative and the Fed continued to hold policy rates steady. After an extensive review, the Bank of Japan (BoJ) announced a new monetary policy initiative targeting a 0% ten-year sovereign yield. To achieve this yield target, the bank will continue to… Read more »

Market Perspectives, Market Updates

August 2016 Monthly Market Review

Markets were mixed in August and performance between risk assets was diverse. Unlike several recent meetings, the Federal Reserve’s annual symposium at Jackson Hole on August 25th contained a more hawkish tone, putting upward pressure on U.S. Treasury yields. Despite a growing view that the Fed put a September rate hike into play, the impact… Read more »

Market Perspectives, Market Updates

July 2016 Monthly Market Review

July was a strong month for equity markets as investors looked past the potential negative impacts of Brexit and equity market volatility abated to more normal levels. In Japan, officials implemented further fiscal and monetary policy expansion, while it appeared the markets expect further initiatives in the United Kingdom. Emerging markets (EM) and non-U.S. developed… Read more »