2nd Quarter 2013

Although the S&P 500 began to show some volatility near the end of the 2nd quarter, the index still posted solid gains. For the quarter, it was up 2.91% on a total return basis. And at the end of the 2nd quarter, the posted total return number was 13.82% for the year.

As I’ve been discussing in a lot of my research, interest rates are going higher. This fact appears to be the main cause of the market’s volatility. However, it does appear that short-term rates are staying low and the rise in rates is focused more on the long-end of the curve. This has the effect of steepening the yield curve, which generally signals a healthy economy.

Time will tell on how all these moving pieces will shake out, but for now the markets are posting nice gains and the yield curve is getting steeper and, perhaps, more “normal.”

Please click on the link below for the full report.

2nd Quarter 2013 Client Newsletter

1st Quarter 2013

The S&P 500 is behaving like a freight-train, as of late.

This train registered a gain of 10.61% this quarter with the Health Care sector leading the way with its 15.22% gain. The Consumer Staples sector also posted a very nice return of 13.77%. In fact, all sectors showed positive returns. The “lagging” sector was Basic Materials and it showed a gain of 4.17%. To be quite frank, 4.17% is a really solid return, particularly in light of current interest rate levels.

There is no doubt in my mind that this generalized appreciation in the market is due to rising sentiment. The U of M Sentiment Survey is not registering an optimistic reading yet, but it is well off its lows. This could imply the market has further to run, but, regardless, we need to keep our eyes on market-related data and strive to stay ahead of this train.

Please click on the link below for the full report.

1st Quarter 2013 Client Newsletter