Blog Posts tagged "Federal Reserve"

Income Report Card | January 2018

Author: Nathan J. Rowader
Date: January 22, 2018
Category: Asset Allocation, Financial Planning
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With 2017 behind us, let’s look back at this remarkable year. Global stocks finished with a gain of 23.92% with foreign markets leading the way thanks in part to a weak U.S. dollar. The emerging markets (EM) represent the biggest winners globally, gaining 37.90% in U.S. dollar terms and 30.55% in local currency. Japan and Europe also posted strong gains with Japanese stocks gaining 23.76% and European stocks gaining 26.62%. In this case, the weaker dollar played an even more meaningful role as European stocks only gained 13.06% in local currency and Japanese stocks gained 19.75% in yen. U.S. stocks were not left behind, finishing the year with a gain of 21.27%. Small-cap U.S. stocks finished the year with a gain of 14.14%. The gains were certainly impressive, but when we look behind the curtain we learn some very interesting facts, most notably that U.S. stocks have gone 282 days without a 3% correction—the longest period in history. Additionally, 42 of the 44 stock markets followed by MSCI posted gains as well as nine of the 11 sectors. The most unusual sector was energy, which posted a decline for the year despite the rise in oil prices, marking the first time in 15 years energy declined while oil rose. Energy also posted the biggest sector swing in year-over-year earnings ever besides financials during the 2008-2009 financial crisis, which we believe is likely a positive sign for energy stocks going into 2018.

Income Report Card | September 2017

Author: Nathan J. Rowader
Date: September 12, 2017
Category: Asset Allocation, Financial Planning
Tags: , , , , , , , , , , ,

Global stocks had a decent month with the MSCI All Country World Index ending the month of August with a gain of 0.44%. However, nearly all this advance can be attributed to the emerging markets (EM). The MSCI Emerging Markets Index gained 2.23% for the month of August while the S&P 500 Index gained 0.31%, the MSCI Europe Index gained 0.06% and the MSCI Japan Index lost -0.05%. Small-cap stocks continue to have a rough time, as the Russell 2000 Index declined by -1.27% on the month. Because of the strong August performance, the MSCI Emerging Markets is up 28.29% year-to-date, nearly three times the gain of the S&P 500, which is up 11.93% in 2017. Last month, we discussed the impact of currency and that much of the gains in foreign stocks and bonds can be attributed to the rise of the euro and yen relative the dollar. Since this has been a key macro event driving foreign assets, it should be no surprise that August’s lackluster returns for foreign stocks was accompanied by a decline in the U.S. Dollar Index, which fell -0.21% for the month.


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