Commentary



2018 3rd Quarter Commentary

2018 3rd Quarter Commentary

During the quarter, equity markets broke out of their trading range and rallied, with the S&P 500 Index reaching an all-time high of 2,931 in September. The economic expansion continued, and revenue and earnings for the S&P 500 once again significantly exceeded forecasts.
2018 2nd Quarter Commentary

2018 2nd Quarter Commentary

During the quarter, equity markets traded in a narrow range with less volatility than was seen earlier in the year. The S&P 500 experienced a modest recovery and ended the quarter at 2,736—a positive return for the period but still 5% below the high reached in early January. The synchronized global economic expansion continued, with revenue and earnings for the S&P 500 once again significantly exceeding forecasts.
2018 1st Quarter Commentary

2018 1st Quarter Commentary

Equity markets experienced a volatile beginning to 2018. The S&P 500 ended the first quarter at 2,641—just slightly below where it started the year—after being up almost 8% in January. The synchronized global economic expansion continued, with revenue and earnings for the S&P 500 once again significantly exceeding forecasts. Domestically, expectations for economic growth have been driven by strong business sales, industrial production, and tax reform.
2017 4th Quarter Commentary

2017 4th Quarter Commentary

During the quarter, equity markets continued to rally, and the S&P 500 ended the year at 2,674—slightly below its record high. A synchronized global economic expansion drove stock markets to higher-than-anticipated levels around the world. Domestically, economic fundamentals such as consumer spending and an expanding housing market have driven modest growth that is likely to accelerate slightly next year as a result of tax reform. Global economic growth is likely to continue to be strong.
2017 3rd Quarter Commentary

2017 3rd Quarter Commentary

During the quarter, equity markets resumed their rallies, and the S&P 500 ended the quarter at 2,519—closing at a record for the 39th time this year. A synchronized global economic expansion is driving stock markets higher around the world. Domestically, economic fundamentals such as consumer spending, housing, and manufacturing remain healthy.
2017 2nd Quarter Commentary

2017 2nd Quarter Commentary

During the quarter, equity markets moved higher to close out a strong first half of the year. In fact, this was the strongest first half since 2013. The S&P 500 ended the quarter at 2,423—slightly below the record high set on June 19. The Fed increased interest rates for the second time this year and plans to increase rates further.
2017 1st Quarter Commentary

2017 1st Quarter Commentary

Equity markets experienced a strong start to the year. The S&P 500 ended the quarter at 2,363—slightly below the record high set on March 1. The Fed increased interest rates for the third time in 15 months, and three increases are now expected in 2017 instead of two.
2016 4th Quarter Commentary

2016 4th Quarter Commentary

During the quarter, equity markets experienced a strong rally after Election Day. The S&P 500 ended the year at 2,239—slightly below its record high. The direction of interest rates drove equity returns for most of the year, with lower rates in the first half and higher rates in the second. The Fed increased interest rates for only the second time in nine years, and additional increases are expected in 2017.
2016 3rd Quarter Investment Commentary

2016 3rd Quarter Investment Commentary

During the quarter, equity markets recovered from the volatility driven by the United Kingdom’s unexpected vote to leave the European Union (Brexit), and the S&P 500 ended the period with a positive return. This rebound, along with stable economic data points, puts a Federal Reserve rate increase back on the table for later this year.
2016 2nd Quarter Commentary

2016 2nd Quarter Commentary

During the quarter, equity markets experienced volatility but ended at a slightly higher level. The United Kingdom’s unexpected vote to leave the European Union (Brexit) drove most of the volatility, although the long-term effects of this decision are unclear for now. Continued aggressive monetary policy on the part of foreign central banks has driven $11.7 trillion of global debt into negative-yield territory.
2016 1st Quarter Commentary

2016 1st Quarter Commentary

During the quarter, equity markets experienced a significant correction, but the S&P 500 ended the period with a slightly positive return. Investors were concerned about a possible recession in the U.S. and an economic slowdown in China, Europe, and Japan. As some signs of economic stabilization appeared and the Federal Reserve softened its stance on interest rate increases, markets rebounded.
2015 4th Quarter Commentary

2015 4th Quarter Commentary

During the quarter, equity markets experienced a modest rebound, albeit with higher volatility. The S&P 500 ended the year at 2,044 — 4% below the high it reached in May and basically back where it started 2015. Economic growth was positive for the year, but earnings for the S&P 500 treaded water due to the stronger dollar, a continued significant correction in commodities, and a lackluster pricing environment. For now, we continue to position portfolios for modest economic growth, although we expect the recent volatility to continue.
2015 3rd Quarter Commentary

2015 3rd Quarter Commentary

During the quarter, equity markets experienced the first significant correction since 2011. After a swift 12% decline, the S&P 500 rebounded, ending the period down 6.4%. Recent growth in the U.S. economy has surprised to the upside. Global growth and markets, specifically China, were the source of concern. For now, we view this correction as an opportunity to add to our most compelling names, although we are watching for signs of deteriorating fundamentals.
2015 2nd Quarter Commentary

2015 2nd Quarter Commentary

During the quarter, equity markets continued to trade within a narrow range. The S&P 500 ended the period with a slightly positive return, closing at 2,063. The U.S. economy experienced another soft patch in the first half of the year. Nonetheless, the employment picture continues to improve, and wages are increasing. We continue to position portfolios for economic growth, although we expect volatility to reappear.
2015 1st Quarter Commentary

2015 1st Quarter Commentary

During the quarter, equity markets struggled for direction, but the S&P 500 ended the period with a positive return, closing at a near record of 2,067. The technology-heavy NASDAQ index finally broke the 5,000 level, last seen 15 years ago during the tech bubble. The U.S. economy continues to expand at a modest pace, and the employment picture has improved. We continue to position portfolios for modest economic growth, although we expect volatility to remain elevated.
2014 4th Quarter Commentary

2014 4th Quarter Commentary

During the quarter, equity markets experienced higher volatility. After retreating almost to its January starting point in the first two weeks of the quarter, the S&P 500 abruptly changed course and rallied 10.5% to end the year at 2,058, nearly an all-time high. Volatility seems to be back up to levels we have not experienced for a few years.
2014 3rd Quarter Commentary

2014 3rd Quarter Commentary

During the quarter, equity markets continued to rally, and the S&P 500 crossed an important psychological barrier of 2,000, although it ended the quarter at 1,972. After a pause during the first quarter, economic growth surprised to the upside in the second quarter and has resumed the upward trend that began in the middle of 2013. The industrial part of the economy continues to improve.
2014 2nd Quarter Commentary

2014 2nd Quarter Commentary

During the quarter, equity markets continued to rally, and the S&P 500 Index reached yet another all-time high in June of 1,963. After a pause in economic growth during the first quarter due to harsh winter weather, the economy is showing signs of improvement. Over the past two years, the S&P 500 has returned 50.1%, including dividends, with only minor pullbacks along the way.
2014 1st Quarter Commentary

2014 1st Quarter Commentary

During the quarter, equity markets experienced some volatility, although the S&P 500 Index reached yet another all-time high in March of 1,878. After showing promising strength late last year, the economy seems to have hit another soft patch. Many of the investment catalysts we had been looking for began to surface in the second half of 2013 and we believe this strength will reemerge when this harsh winter ends. We continue to position portfolios for modest economic growth, although we expect higher volatility as the year progresses.
2013 4th Quarter Commentary

2013 4th Quarter Commentary

During the quarter, equity markets continued to rally, and the S&P 500 Index reached yet another all-time high in December of 1,848. This is now the fourth quarter in a row in which the S&P 500 has set a record. Economic growth has recently accelerated, and many of the investment catalysts we have been looking for have begun to surface.
2013 3rd Quarter Commentary

2013 3rd Quarter Commentary

During the quarter, equity markets continued to rally, and the S&P 500 Index reached an all-time high in September of 1,725. This is the third quarter in a row in which the S&P 500 has set a record. Nonetheless, interest-rate-sensitive asset classes experienced significant price volatility as investors digested contradictory comments from the Federal Reserve Board.
2013 2nd Quarter Commentary

2013 2nd Quarter Commentary

During the quarter, equity markets continued to rally. In May, the S&P 500 Index reached an all-time high of 1,669, joining the Dow Jones Index, which reached an all-time high during the prior quarter. Over the last 12 months, the S&P 500 has returned 25.8%, including dividends, with only minor pullbacks along the way. In June, the market retreated slightly after comments by the Federal Reserve Board that signaled some "tapering" of its latest QE program if the economy continues to improve.
2013 1st Quarter Commentary

2013 1st Quarter Commentary

During the quarter, U.S. equity markets continued to rally despite concerns about the U.S. fiscal outlook, Fed policy, bond distortions, corporate profits, and global uncertainty. In fact, this was the best firstquarter performance for the Dow Jones and S&P 500 since 1998, and both indices reached new all-time highs. Given this impressive rally after a strong 2012, we have refocused our efforts on the fundamentals.
2012 4th Quarter Commentary

2012 4th Quarter Commentary

Despite muted economic activity and Congress’s waiting until the final hour to reach a compromise regarding the Fiscal Cliff equity markets ended the quarter largely unchanged. We continue to think an improvement in fundamentals will be required to propel equity markets meaningfully higher over the coming quarters.
2012 3rd Quarter Commentary

2012 3rd Quarter Commentary

During the quarter, equity markets reached new highs for the year as the prospects for increased government stimulus became a reality. However, the underlying fundamentals continue to be mixed. Ultimately, we think that an acceleration in economic conditions will be required to support further near-term equity market appreciation.
2012 2nd Quarter Commentary

2012 2nd Quarter Commentary

After strong first-quarter performance, equity markets retreated as European macroeconomic concerns once again resurfaced, reigniting market volatility similar to what we experienced last summer. Despite this ongoing uncertainty, we remain constructive on the long-term outlook for the U.S. economy and corresponding equity markets.
2012 1st Quarter Commentary

2012 1st Quarter Commentary

As we stated in our 3Q11 commentary, “We think the state of the global economy and outlook for equity markets are not as bleak as some have indicated.” We viewed the summer correction as an opportunity and increased our exposure to growth-oriented sectors. During the first quarter of 2012, economic conditions continued to improve, helping to lift equity markets. Overall, we continue to think the environment for equities looks positive through the end of the year.
2011 4th Quarter Commentary

2011 4th Quarter Commentary

Global equity markets rallied during the final quarter of 2011 as the U.S. averted a “double-dip” recession and European debt crisis fears subsided. Despite the global macro-economic uncertainty, U.S. economic activity continues to show signs of improvement and we think that on a longer term basis, there are attractive investment opportunities in the market today.
2011 3rd Quarter Commentary

2011 3rd Quarter Commentary

During the quarter, the global markets experienced a significant increase in volatility as prospects for growth turned into fears of a global recession and a possible financial crisis in Europe. Investors quickly sold equities, with little regard to the fundamentals. As long-term investors, we view times like this as an opportunity.
2011 2nd Quarter Commentary

2011 2nd Quarter Commentary

As we highlighted in our last commentary, we expect market volatility to remain high for the remainder of 2011. This was certainly the case in the second quarter. For the quarter, the S&P 500 declined only 0.40%; however, the index dropped over 7.0% from its recent peak in early May then rallied nearly 4.2% during the final four trading days of June. Year to date, the S&P 500 has gained 5.0%.
2011 1st Quarter Commentary

2011 1st Quarter Commentary

At the end of 2010, we saw continued reasons for cautious optimism, but also felt that volatility was likely to remain high. In view of the alternatives, we felt it best to stay largely invested. For the first quarter of 2011, the S&P 500 managed to gain 5.4%, despite the escalation of tensions in the Middle East, the largest earthquake recorded in Japan and related tsunami and the continued sovereign debt stress across Europe. Yet, this has been the best first quarter return for the S&P 500 in more than 13 years.

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