Capital Markets Review (as of 3/31/2017)
Chart of the Week for May 7, 2017 - April 13, 2017
Capital market returns in U.S. dollars were positive in the first quarter of 2017. U.S. Bonds, U.S. High Yield Bonds, U.S. Large-Cap Stocks, Emerging Market Stocks, U.S. Small-Cap Stocks and International Developed Market Stocks also had positive returns over the trailing 1-, 5,- and 10-year periods as shown in the chart above.
For the first quarter of 2017, Emerging Markets Stocks (11.45%), and International Developed Market Stocks (7.25%), provided the highest return and were aided by generally improving global economic conditions and a weaker U.S. dollar. Domestically, U.S. Large-Cap Stocks (6.07%), U.S. High Yield Bonds (2.70%), and U.S. Small-Cap Stocks (2.47%), also posted positive returns, as discussions about possible regulatory and tax reforms following the U.S Presidential election helped those sectors. Rising shorter-term interest rates, but stable medium-to-long-term interest rates, impacted U.S. Bonds (0.82%) during the quarter.
For the trailing 1-year, U.S. Small-Cap Stocks (26.22%) posted the highest return of any sector noted for the periods above. The generally improving U.S. economy helped as many smaller companies have more of their business derived in the U.S. and are less subject to international market factors.
In the chart above:
- U.S. Bonds are represented by the Bloomberg Barclays U.S. Aggregate Bond Index.
- U.S. High Yield Bonds are represented by the Bloomberg Barclays U.S. Corporate High Yield Index.
- U.S. Large-Cap Stocks are represented by the S&P 500 Index.
- U.S. Small-Cap Stocks are represented by the Russell 2000 Index.
- International Developed Market Stocks are represented by the MSCI EAFE (Net) Index.
- Emerging Market Stocks are represented by the MSCI Emerging Markets (Net) Index.
Posted by: sarah_oz@yahoo.com
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