news and events


Capital Markets Recap - March 2019

Pipe

SUMMARY

  • U.S. equities were positive in March and finished the first quarter with the best returns in seven years. Real GDP increased by an annualized rate of 2.2% in the fourth quarter, a downward revision from the 2.6% initial estimate. The unemployment rate ticked down to 3.8% in February in part due to furloughed federal employees returning to work after the partial government shutdown. Consumer confidence decreased in March. Consumers remain poised for continued near-term economic expansion, though sentiment has been trending down since the summer of 2018. U.S. manufacturing operating conditions improved moderately in March but dipped to levels last seen in mid-2017.
  • International equities and emerging market equities trended higher in March. The Eurozone manufacturing sector experienced the greatest contraction in nearly six years as demand deteriorated with concerns of trade wars, political uncertainty, and Brexit. U.K. manufacturing PMI hit a 13-month high. Preparations for Brexit in the U.K. led to strong increases in inventories as companies tried to lock in prices and certainty of supply. China saw operating conditions improve for the first time since November and business outlook sentiment improved to a 10-month high. Chinese employment expanded for the first time in over five years.
  • Fixed income investment returns were solid in March. The yield curve inverted during the month with the 3-year U.S. Treasury Note offering a higher yield than the 10-year. Buyers of bonds are predicting lower interest rates in the future and see the inverted yield curve as an indicator of an economic recession. 10-year Treasury yield decreased to 2.4% to end the month of March.

U.S. EQUITIES

  • Broad U.S. stocks were positive (up 1.5%) for the month and on a 1-year basis (up 8.8%).
  • Size – Large-cap (up 1.7%) and mid-cap (up 0.9%) equities outpaced small-cap (down -2.1%) equities in March and large-cap stocks led on a 1-year basis over small-cap stocks (9.3% vs. 6.5%).
  • Style – Growth stocks (up 2.5%) outgained value stocks (up 0.4%) in the month and continue to meaningfully outperform on a 1-year basis (12.1% versus 5.3%, respectively).

LOOKING AHEAD

  • After experiencing a volatile end to 2018, the global equity markets were strongly positive during the first quarter of 2019.
  • It is a good time for investors to take stock of their risk appetite and review their current ability to endure continuing market risks.
  • Rebalancing portfolios back to their strategic allocations and reassessing adequacy of cash reserves continue to be important to mitigate risk.
Sources: Morningstar, Inc., Barclays Capital, Russell and MSCI, U.S. Bureau of Labor Statistics, The Conference Board, IHS Markit, The Federal Reserve (central bank of United States), The Bureau of Economic Analysis (U.S. Department of Commerce) & U.S. Department of Treasury

Acacia Wealth Advisors is registered with HighTower Securities, LLC, member FINRA and SIPC, and with HighTower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through HighTower Securities, LLC; advisory services are offered through HighTower Advisors, LLC.

This is not an offer to buy or sell securities. No investment process is free of risk, and there is no guarantee that the investment process or the investment opportunities referenced herein will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment opportunities referenced herein may not be suitable for all investors.

All data and information reference herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in this research is provided as general market commentary, it does not constitute investment advice. The team and HighTower shall not in any way be liable for claims, and make no expressed or implied representations or warranties as to the accuracy or completeness of the data and other information, or for statements or errors contained in or omissions from the obtained data and information referenced herein. The data and information are provided as of the date referenced. Such data and information are subject to change without notice.

This document was created for informational purposes only; the opinions expressed are solely those of the team and do not represent those of HighTower Advisors, LLC, or any of its affiliates.