Following a rocky start to the New Year, most markets rebounded to end the first quarter of 2016 on a slightly positive note. The S&P 500 recovered during the last six weeks to post positive returns of 1.35% and emerging markets surged to a very strong opening quarter gaining 5.71%. US bonds also rallied with the Barclays Aggregate bond index up 3.03% for the quarter. US small companies and international developed markets finished in negative territory down -1.52% and -1.95% respectively.
Markets faced serious headwinds at the tail end of 2015 due to slowing economic growth around the world. Combined with rising interest rates, a strong dollar, and falling commodities prices, we faced a perfect storm of factors that ticked off a stock market correction. However, after falling by as much as 10.5% earlier in 2016, the S&P 500 gained 6.8% in March. Given the roller coaster ride we've had this year, the recent gains are a testament to the resilience of investors.
YTD=Year To Date performance through date listed above. Index Data: US Large Cap Stocks: S&P 500, US Small Cap Stocks: Russell 2000, Developed International Markets: MSCI World EX US Index, Emerging Markets: MSCI Emerging Markets Index, US Bonds: Barclays US Aggregate Bond Index
By Tim Baker, CFP®
Advice and investment design should rely on long term, proven evidence. This column is dedicated to helping investors across the country, from all walks of life to understand the benefits of disciplined investing and the importance of planning.