EWM Weekly Capital Market Highlights for Week Ended 08/10/2018

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WEEKLY CAPITAL MARKET HIGHLIGHTS:

  • Global equity markets were mostly up on the week through Thursday. Of major markets, Russia and Latin America lagged the most, returning -4.2% and -3.5%, respectively. On the other end, China was the market leader for the week along with other major markets in Asia.
  • The Treasury yield flattened modestly through Thursday. Yields on notes and bonds with maturities longer than three years decreased slightly, while shorter-term maturities saw a slight increase.
  • Commodities were slightly positive for the week. Energy and Gold were the largest detractors through Thursday., whereas Agriculture fared much better.
  • The US Dollar rose this week against a basket of major trade partners’ currencies. The index has experienced somewhat of a rally off lows from earlier in the year, as it seems the currency may be “winning” the trade war..
  • In other economic news: The Federal Reserve’s (the Fed) balance sheet is up $2.4 billion for the week, and assets reside at $4.258 trillion in total. However, they are down $202.4 billion from the balance sheet unwinding that began in October 2017.

Click here to download the complete weekly report: EWMWeeklyReview 8.10.18

Endowment IndexTM Falls For Week Ended 8/10/2018

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The Endowment Index calculated by Nasdaq OMX® (Symbol: ENDOW) closed at 1,262.68 today, falling from last Friday’s close of 1,268.10.

The Endowment Index represents the investable opportunity for managers of portfolios utilizing the Endowment Investment Philosophy or otherwise incorporate alternative investments within a comprehensive asset allocation strategy. The Endowment Index measures performance for a multi-asset, globally-diversified, three-dimensional portfolio that includes Global Equity, Global Income, and Alternative Investments (like Private Equity, Hedge Funds and Real Assets). The Index uses an objective, rules-based construction methodology based upon the portfolio allocations of over 800 educational institutions managing over $500 billion in total assets. Each of the 19 sub-indexes that currently comprise the index are investable, and contained within those sub-indexes are over 30,000 underlying securities. You can obtain real-time pricing data on the Endowment Index under the symbol “ENDOW” through major quote providers, including Bloomberg, Google Finance and others. The Morningstar® Index ID for the Endowment Index is F00000TPG6.

Past performance is not necessarily indicative of future results. You cannot invest directly in an index. Indexes do not contain fees.

EWM Macro View-July 2018

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Domestic equity markets posted strong returns in the month of July, with most of the price appreciation coming in the first two weeks of trading. During the month, markets reached highs not seen since the end of January on news of strong economic data. The unemployment rate declined to 3.9%, the second lowest rate in the last 48 years, and second-quarter US Gross Domestic Product (GDP) grew 4.1%, the highest rate in almost four years. For the time being, it appears that the US’s strong economic activity is overshadowing the very serious concerns of a global trade war, as the Trump Administration aggressively renegotiates trade deals with the European Union and China. Even with valuations near all-time highs, companies are still repurchasing their own stock. Last quarter marked a record, as US companies spent almost $437 billion on buyback plans.

For the month of July, the S&P 500 Index and the DJIA returned 3.72% and 4.83%, respectively, as 83% of the S&P 500 companies reported earnings per share that exceeded expectations. For the first time since February, large cap domestic stocks outperformed small cap equities, as the Russell 1000 Index returned 3.45% and the Russell 2000 returned 1.74%. Mid cap stocks also outperformed small caps, with the Russell Mid Cap Index gaining 2.49%. Value stocks outperformed growth stocks, with the Russell 3000 Value Index returning 3.79% compared with 2.84% for the Russell 3000 Growth Index. Sector performance was strong, with positive returns across the board. The high-end Industrials and Health Care sectors generated returns of 7.32% and 6.61%, respectively, whereas the Real Estate and Energy sectors returned 1.08% and 1.42%, respectively. The Bloomberg Commodity Index, recently the worst-performing asset class for the quarter, incurred a loss of 2.13%.

International equity markets posted weaker results when compared with their domestic large cap counterparts, with the MSCI ACWI ex-U.S. Index returning 2.39% for the month of July. The European Central Bank (ECB) indicated no change to its accommodative monetary policy, pledging to keep interest rates the same for at least another year. Additionally, the potential for a trade war between the US and the European Union seems to have diminished after President Trump and European Commission President Jean-Claude Juncker agreed to work to lower trade barriers between the two trade partners. Both parties promised to forgo placing further tariffs while negotiations are under way. Economic activity continues to be positive, as the International Monetary Fund reported real global GDP growth of 3.64% for the first quarter. Furthermore, the ECB is forecasting real GDP growth to hit 2.4% for 2018. International developed equities and emerging markets equities posted similar returns for the month, with the MSCI EAFE Index up 2.46% and the MSCI EM Index 2.20%.

Fixed income markets produced mixed returns for the month, as longer-term yields trended higher. The yields on the 3-month Treasury Note and the 10-Year Treasury Bond increased, ending the month at 2.03% and 2.96%, respectively, resulting in a further flattening, albeit small, of the US Treasury curve. Despite the strength in GDP, driven by consumer spending and nonresidential business investment, Federal Reserve policy makers are expected to continue their gradual pace of interest rate hikes, with two more in store for the year.

The Bloomberg Barclays U.S. Aggregate Bond Index increased 0.02% for the month, with investment-grade corporates contributing 83 basis points for the month, whereas US government and Treasury securities were down 0.41% and 0.42%, respectively. Global bonds struggled relative to domestic fixed income, as the Barclays Global Aggregate ex-U.S. Index lost 0.17%. However, emerging markets debt was the best-performing asset class within fixed income, returning 2.50%. High yielding fixed income securities posted strong performance, returning 1.09% for the month.

Municipal bonds posted positive returns, and outperformed their taxable counterparts, with the Bloomberg Barclays Municipal Index returning 0.24% for the month. Within the municipal space, the shorter-term securities fared better, with the 1-2 Year Index beating the 22+ Year Index by 20 basis points.

EWM Weekly Capital Market Highlights for Week Ended 08/03/2018

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WEEKLY CAPITAL MARKET HIGHLIGHTS:

  • Domestic equities were positive for the week, with small cap stocks leading the way. International equities were down on the week, and emerging markets struggled the most.
  • Treasury yields were mostly up through end of day Thursday, with the greatest increase in yields occurring at the longer end of the curve.
  • The US dollar strengthened during the week, as the Bank of England raised rates and its hawkish remarks failed to appease investors’ concerns about the economic outlook.
  • Commodities were down overall, led by a drop in gold prices. Oil ended the week in positive territory.
  • In other economic news, the Purchasing Managers’ Index, which indicates the overall economic health of the manufacturing sector, was down to a five-month low of 55.3. The report indicates continued economic expansion despite headwinds from supply shortages, rising prices, and deteriorating exports.

Click here to download the complete weekly report: ewmweeklyreview8318

Endowment Index Falls For Week Ended 8/3/2018

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The Endowment Index calculated by Nasdaq OMX® (Symbol: ENDOW) closed at 1,268.10 today, falling from last Friday’s close of 1,274.08.

The Endowment Index represents the investable opportunity for managers of portfolios utilizing the Endowment Investment Philosophy or otherwise incorporate alternative investments within a comprehensive asset allocation strategy. The Endowment Index measures performance for a multi-asset, globally-diversified, three-dimensional portfolio that includes Global Equity, Global Income, and Alternative Investments (like Private Equity, Hedge Funds and Real Assets). The Index uses an objective, rules-based construction methodology based upon the portfolio allocations of over 800 educational institutions managing over $500 billion in total assets. Each of the 19 sub-indexes that currently comprise the index are investable, and contained within those sub-indexes are over 30,000 underlying securities. You can obtain real-time pricing data on the Endowment Index under the symbol “ENDOW” through major quote providers, including Bloomberg, Google Finance and others. The Morningstar® Index ID for the Endowment Index is F00000TPG6.

Past performance is not necessarily indicative of future results. You cannot invest directly in an index. Indexes do not contain fees.

EWM Weekly Capital Market Highlights for Week Ended 07/27/2018

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WEEKLY CAPITAL MARKET HIGHLIGHTS:

  • Among equities, the emerging markets were the big winner in the week, led by Russia, India, and China. Japanese equities were up almost 2% on the week. Europe was mixed, with Germany also up nearly 2%, but Italy, Spain, and the UK were up less than 1%. US large cap equities were up about 1%, whereas small caps were essentially flat on the week.
  • Treasury yields jump. Treasury yields moved higher by 9-10 basis points across the curve this week, with the yield on the 10-Year Note flirting with the 3.0% level. Most of the increase came early in the week, as Japanese JGB’s also sold off on reports of a change being discussed in the Bank of Japan’s quantitative easing program.
  • The US Dollar Index ended a relatively volatile week largely unchanged. A modest rally on Monday and Tuesday was reversed on Wednesday on news of a “truce” with the EU on trade. It rallied again on Thursday, mostly against the euro, as the ECB left rates unchanged.
  • Crude Oil was up slightly on the week and is now up just slightly more than 15% for the year. Tensions with Iran and a labor strike on several North Sea platforms pushed prices higher, even as a strike in Norway was settled last Friday.
  • Among other economic data released this week: Durable goods orders were up 1.0% in June, but well below the expected increase of 3.7%. The US goods trade deficit widened by 5.5% in June, as exports fell by 1.5% and imports rose by 0.6%. US consumer sentiment remains high, despite falling to a six-month low in June. US GDP hits 4.1%, best in nearly four years. The initial estimate for growth in the second quarter came in at 4.1%, driven by higher consumer and government spending. The final estimate for first quarter GDP was revised higher from 2.0 to 2.2%. The trade gap narrowed in the second quarter, but primarily due to foreign buyers increasing purchases before the Administration’s new tariffs take effect later this year.

Click here to download the complete weekly report: EWMWeeklyReview 7.27.18

EWM Weekly Capital Market Highlights for Week Ended 07/20/2018

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WEEKLY CAPITAL MARKET HIGHLIGHTS:

  • Among equities, small caps outperformed large caps; growth stocks beat value stocks; international stocks essentially matched the performance of US stocks; and emerging markets under performed developed markets.
  • Treasury yields little changed. The yield on the 10-year Treasury Note stayed close to the 2.85% level.
  • Commodity indices declined slightly, dragged down mainly by sliding gold price, which hit a 52-week low during the week.
  • The dollar’s rise slowed somewhat, after President Trump complained about the strong dollar.
  • Among major economic data, retail sales surged, housing starts plunged, and jobless claims hit a multi decade low.

Click here to download the complete weekly report: EWMWeeklyReview 7.20.18

Endowment Index™ Posts Slight Gain For Week Ended 7/20/2018

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The Endowment Index calculated by Nasdaq OMX® (Symbol: ENDOW) closed at 1,268.45 today, rising slightly from last Friday’s close of 1,268.20.

The Endowment Index represents the investable opportunity for managers of portfolios utilizing the Endowment Investment Philosophy or otherwise incorporate alternative investments within a comprehensive asset allocation strategy. The Endowment Index measures performance for a multi-asset, globally-diversified, three-dimensional portfolio that includes Global Equity, Global Income, and Alternative Investments (like Private Equity, Hedge Funds and Real Assets). The Index uses an objective, rules-based construction methodology based upon the portfolio allocations of over 800 educational institutions managing over $500 billion in total assets. Each of the 19 sub-indexes that currently comprise the index are investable, and contained within those sub-indexes are over 30,000 underlying securities. You can obtain real-time pricing data on the Endowment Index under the symbol “ENDOW” through major quote providers, including Bloomberg, Google Finance and others. The Morningstar® Index ID for the Endowment Index is F00000TPG6.

Past performance is not necessarily indicative of future results. You cannot invest directly in an index. Indexes do not contain fees.

Endowment Index Posts Gain For Week Ended 7/13/2018

By | Endowment Index™ | No Comments

The Endowment Index calculated by Nasdaq OMX® (Symbol: ENDOW) closed at 1,268.20 today, rising from last Friday’s close of 1,261.28.

The Endowment Index represents the investable opportunity for managers of portfolios utilizing the Endowment Investment Philosophy or otherwise incorporate alternative investments within a comprehensive asset allocation strategy. The Endowment Index measures performance for a multi-asset, globally-diversified, three-dimensional portfolio that includes Global Equity, Global Income, and Alternative Investments (like Private Equity, Hedge Funds and Real Assets). The Index uses an objective, rules-based construction methodology based upon the portfolio allocations of over 800 educational institutions managing over $500 billion in total assets. Each of the 19 sub-indexes that currently comprise the index are investable, and contained within those sub-indexes are over 30,000 underlying securities. You can obtain real-time pricing data on the Endowment Index under the symbol “ENDOW” through major quote providers, including Bloomberg, Google Finance and others. The Morningstar® Index ID for the Endowment Index is F00000TPG6.

Past performance is not necessarily indicative of future results. You cannot invest directly in an index. Indexes do not contain fees.

EWM Weekly Capital Market Highlights for Week Ended 07/13/2018

By | Financial Markets & Economy | No Comments

WEEKLY CAPITAL MARKET HIGHLIGHTS:

  • Domestic equities remained positive for the week, with tech stocks leading the charge. Indian equities also enjoyed a healthy rally, as did Emerging Market Latin America. European markets had mixed results, with France, Germany, the UK, and Russia slightly positive, whereas Italy, Spain, and Greece turned negative. The broader emerging markets space also was positive for the week.

 

  • The yield on the 10-Year US Treasury Note closed roughly in line with the week’s opening yield of 2.834%, as world markets wait to see how China will react to the most recent wave of tariffs proposed by the Trump Administration.

 

  • The US dollar strengthened over the course of the week. A down-tick in jobless claims to the lowest level since early May continued the strengthening economy narrative.

 

  • Commodities were mostly lower for the week, with oil and grains being the largest drags. Precious metals were mostly positive, but gold ended the week at a slight loss.

 

  • In other economic news the Producer Price Index rose 0.3% in June, and 3.4% for the 12 months ended in June, the largest 12-month increase since climbing 3.7% in November 2011; Crude Inventories plunged by 12.6 million barrels during the week of July 6 to 405.2 million, 18.2% below their level a year ago; the Consumer Price Index (CPI) edged only 0.1% higher overall in June, and the Core CPI (ex food and energy) was up 0.2% ; Consumer Sentiment is easing back so far this month to 97.1, which is down 1.1 points from June.

Click here to download the complete weekly report: EWMWeeklyReview 7.13.18