MARKET RECAP*
- Major U.S stock markets continued to make new highs in February driven in part by positive economic messages from the Federal Reserve and President Trump
- The S&P 500 steadily climbed during the month, posting a 3.9% gain
- Top Sectors: Health Care (+6.4%), Utilities (+5.3%)
- Bottom Sectors: Energy (‐2.2%), Telecom (‐0.4%)
- The outperformance of some of the more defensive sectors of the market (health care and utilities) is a reversal from what has been occurring since the election
- However, the cyclical sectors have not given up their lead as President Trump continues to reiterate his pro‐growth policies
- Growth outperformed Value across all market capitalizations again in February, leading by just 0.6%
- If President Trump’s growth initiatives get pushed through Congress, we could see this trend reverse in the latter part of the year
- International developed countries was the worst performing equity asset class, increasing by 1.2%
- Emerging markets rose 1.7% higher on the month from positive economic surprises in many of these countries
- Long‐Term Treasuries returned 1.6% on the month as yields dropped slightly, despite many Fed officials calling for rate increases in the near future
- The ten‐year Treasury yield ended the month at 2.36%, down 0.09%
ECONOMIC NEWS
- The U.S. economy added 235,000 jobs in February, easily exceeding expectations of 197,000, which caused the unemployment rate to decrease to 4.7%***
- The Bloomberg consumer confidence index increased to 114.8, the highest level since July 2001, raising consumer expectations for the next six months **
- Consensus predictions say a rate hike at the Federal Reserve’s March 15th meeting is now a 96% probability, which is up from a 15% probability at the end of January**
