The election is over, and investors in the U.S. stock market seem to like the results. Investors in everything else—namely foreign stocks and bonds—aren’t as happy.
Stocks and bonds had a solid month as investors grow increasingly comfortable with the notion that we can avoid a recession and inflation with the current path of central bank management. The real action was in China—the hottest market by far — with more than a 20% return in September, mostly from the last two weeks alone.
The smooth ride up for US stocks seems to have ended as investors grapple with the good news of slowing inflation and likely rate decreases by the Fed, alongside the potentially bad news that the reason for inflation coming down is that the entire economy might follow it downward. Dropping rates slowly may not be enough to prevent this.
Rising speculation in crypto and meme stocks didn’t seem to alarm investors even though it could mean the Fed is going to keep burning money a bit longer.
In April 2024 the financial markets experienced heightened volatility due to an increase in interest rates, which impacted bond prices. Our Conservative portfolio declined by 3.86%, while our Aggressive portfolio fell 3.06%.
March deviated from the norm with the S&P 500 index not beating 90% of fund returns — it was more in the middle of all stock fund categories with a still respectable 3.22% gain. It seems the longstanding outperformance of the top growth stocks may be waning.
The market booked another strong month for U.S. stocks. The only foreign market that outperformed the U.S. in February was China which rebounded nearly 10%.
