MARKET REPORT: August 2017

Prepared by Brandon Yee and Thomas Connelly

 


Commentary
Developed Markets Flat in August – In the month of August, U.S. equities outperformed international developed markets by 0.27%. The United Kingdom and Japan lagged the broader markets, dropping 0.77% and 0.05%, respectively.

 


Commentary
Emerging Markets Continue Strong Run – Emerging markets recorded a gain of 2.95% for the month. Russia and Brazil had the largest gains of 8.13% and 6.31%, respectively. Emerging markets have outperformed developed markets over the past year.

 


Commentary
Utilities Record Strong Month – Utilities and information technology posted the strongest global sector returns of 3.18% and 2.74%, respectively. Energy and financials had the toughest month, dropping 3.01% and 1.48%, respectively.

 


Commentary
Growth Outperformed Value – In August, domestic value indices underperformed their growth counterparts. Momentum recorded a strong return relative to the other styles.

 


Commentary
Emerging Small Cap Companies Edge Higher – In the international developed markets, value indices underperformed growth indices for the month. Emerging small cap equities posted a strong return of 1.92%.

 


Commentary
Money Market Yields Remain Low – Money market funds continue to have very low yields, performing in line with the 3 month T-Bill Index. One year money market returns are similar to their ten year annualized track record.

 


Commentary
Long-Term Government Bonds Post Solid Return – The returns of deflationary hedges were mostly positive for the month. Long-term government bonds and emerging market bonds recorded the strongest returns of 3.39% and 1.73%, respectively. High yield bonds and leveraged loans were flat for the month.


Commentary
Natural Gas Rebounds – Inflation-sensitive investment returns were mixed in August. The Alerian MLP and crude oil both fell by 4.94%. Natural gas rose 7.17%, rebounding from a tough July. Gold bullion posted a gain of 3.49%.

 


Commentary
Mexican Peso Gaining Ground on U.S. Dollar – The U.S. dollar depreciated against all major currencies over the past three months except for the Israeli Shekel. The Canadian Dollar and Australian appreciated the most versus the U.S. dollar. The Mexican Peso gained 4.46% versus the USD over the same time period.

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