Month in Review: April 2017

Global equity markets continued to rally in April, navigating several high-profile developments throughout the month including a U.S. missile strike in Syria, saber rattling with North Korea, positive results in the French election, and the heart of first quarter U.S. corporate earnings season. Soft inflation data and geopolitical events during the month made U.S. treasury bonds more attractive to investors, pressuring interest rates lower in contrast to consensus calls for rising rates. Emerging markets outperformed developed markets again in April ...

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Month in Review: March 2017

Both U.S. equity markets and interest rates ended the month close to where they began but getting there was far from a straight line. Emerging markets and international developed markets outperformed the U.S. in March as political risks in Europe abated slightly (Dutch elections) and the U.S. dollar weakened relative to most foreign currencies.  Credit spreads compressed slightly over the course of the month while the yield curve flattened in sympathy with the Fed tightening rates.  From a sector standpoint, ...

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Month in Review: February 2017

Equity markets in February rallied sharply as markets rotated away from risk aversion and toward more of a growth and inflation mindset. Encouraging corporate earnings in the U.S., stable markets overseas, and moderately positive U.S. economic data all worked to support the rally in risk assets and uptick in bond yields.  Fed watchers and market gauges read the February tape as a green light for a 0.25% rate hike at the upcoming March FOMC meetings.

Key February Market Anecdotes:

  • In early ...
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Month in Review: January 2017

January introduced us formally to the new President of the United States who took office with the same bold style as on the campaign trail. Markets moved sideways for a couple of weeks but ultimately continued the risk rally that began in early November. With regard to U.S. and European political climate, we feel it is safe to say that it has been years, maybe decades, since political winds have held this much potential to drastically ...

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Month in Review: December 2016

Global equity markets, outside of China and Brazil, followed up a strong November with an encouraging December to finish out the year. The risk rally was clearly driven by optimism surrounding a rebound in corporate earnings and hopes for market friendly reforms in Washington. The importance of healthy earnings to bridge the gap of 2017 is high given the time and shape of new policies in Washington clearly fall more in the 2018 timeframe.

With regard to Washington, market friendly initiatives ...

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Month in Review: October 2016

Markets

• DJIA, S&P 500, and NASDAQ experienced their biggest monthly declines since January and was a third consecutive losing month for the DJIA which hasn’t happened since 2011.

• Global government bonds experienced their largest drop since May 2013. The 10yr U.S. Treasury bond yield shot up meaningfully, from 1.6% to 1.84%, the largest monthly increase since June 2015. The trend of higher yields can act as a ceiling for equity market multiples.

• The upcoming U.S. election is dominating headlines and ...

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Month in Review: September 2016

September closed out the third quarter on a relatively positive note with global equities posting respectable gains. Small caps continued to outperform large caps in September, maintaining the technical leadership they began to assert back in July. From a sector standpoint, technology and energy maintained the market leadership they displayed throughout the third quarter, highlighting the rotation out of first half 2016 winning sectors of utilities and telecoms into some more aggressive sectors of the market. ...

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Month in Review: August 2016

Global equity markets in August managed to post marginally positive returns with emerging markets (+2.5%) again outpacing developed markets (+0.3%). After a double digit loss to begin the year, emerging markets have rallied strongly, posting year to date gains of over 16% which is 7% higher than the average returns for developed markets. U.S. equity markets in August managed to hold onto small gains as the back half of the month gave back nearly all of ...

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Month in Review: July 2016

July was a boon for market bulls, a very solid month for equities across both developed and emerging markets. Interestingly, there were no significant central bank accommodations announced during the month to drive market rallies, but expectations and indications of policy support in England and Europe certainly provided market participants a push of confidence. The ECB, BoJ, BoE, and Federal Reserve all held steady on rates in July. Active QE programs in Japan and Europe continued ...

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