Market commentary, 2nd Quarter 2018

Markets were mixed as volatility persisted due to investor unease regarding global trade. U.S. stocks (S&P 500) were up 3.43% as strong economic data overshadowed investor concerns relating to higher interest rates and trade tariffs against China. Emerging markets were down 7.96% on the increased strength of the U.S. dollar despite higher commodity prices. The Federal Reserve raised its benchmark rate. For the quarter, stocks had a net outflow of $0.84 billion while bonds had a net inflow of $52 billion. Total employment increased by 632,000 jobs this quarter, and the unemployment rate decreased 0.1% to 4%. The broad fixed income market was down due to higher inflation expectations and a continued tightening of monetary conditions. Major domestic equity indices were up over the quarter, with large growth outperforming large value, while small value outperformed small growth. The dollar was up against most major currencies as interest rates rose and U.S. monetary policy continued to tighten.