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Market Recap: 2nd Quarter 2019

July 9th, 2019 | Written by

Market Recap: 2nd Quarter 2019Stock gains continued in April, with the economy growing faster than expected at an annual growth rate of 3.2% for the first quarter.  However, markets stumbled in May triggered again by U.S. and China trade issues, as the U.S. increased tariffs on nearly half of Chinese imports from 10% to 25%, after which China retaliated by increasing tariffs on $60 billion worth of American goods.  After the Dow fell for six weeks in a row and the S&P 500 fell for four weeks, stocks rallied back in June.  Concerns about slowing global economies led to global central banks signaling interest rate cuts, which help move stock markets forward.

Overall for the quarter, large U.S. stocks (up 4.3%) outperformed smaller U.S. stocks (up 2.1%).  The strongest sectors were financials and materials, while energy was the only sector that was negative for the quarter.  International stocks posted gains of 3.97%, while emerging market stocks were relatively flat.

It is now anticipated that the Federal Reserve will decrease interest rates at least one time before the end of the year.  The yield on the 10-year Treasury fell significantly from 2.41% to 1.99% by quarter-end.  The yield curve remains inverted (short-term bond yields are higher than longer-term bond yields) which often precedes a recession.

Our investment team remains vigilant in closely monitoring the current macroeconomic climate and your investment portfolio. We’ve begun to reposition our clients’ portfolios to become marginally more defensive. If you have any questions, please do not hesitate to reach out to your financial advisor.

Index2nd Quarter 2019Year-to-date
Dow Jones 303.21%15.40%
S&P 5004.30%18.54%
Russell 20002.10%16.98%
Bloomberg Barclays U.S. Agg Bond3.08%6.11%
MSCI EAFE Index3.97%14.49%
MSCI EM Index0.74%10.76%

Sources: Y Charts and J.P. Morgan Asset Management

Figures as of June 30, 2019. Past performance cannot guarantee future results.

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    This information is not intended to be used as the only bases for investment decisions, nor should it be constructed as advice designed to meet your particular needs. You are advised to seek the advice of your financial advisor prior to making any decision based on any specific information contained herein.
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