Market Review - August 2021
Source: Zephyr Style Advisor
US stocks climbed higher for the seventh straight month, gaining 3.0% in August. The S&P 500 has hit 53 new all-time highs year to date, surpassing the previous record set in 1964. This can be attributed to robust Q2 corporate earnings growth and sales estimates. International stocks also continued to rally and gained 1.8% for the month. The UK lifting the final domestic COVID restrictions, and Europe’s 70% vaccination rate, were contributing factors to these results. Emerging Markets reversed course from last month and returned 2.6% in August, led by Indian equites (11.0%). There are still regulatory and growth concerns surrounding China that investors are keeping a watchful eye on.
Financials rebounded this month and had the strongest returns (5.1%) of the sectors. Energy was the only sector with negative performance in August, returning -2.0%; a steady decline in oil prices have pushed energy stocks lower for the second month in a row. Growth outperformed value again in August as the fab five - FAANG *- continued to dominate the markets.
US Fixed income markets were relatively flat this month and returned -0.2%. Corporate high yield was the only sector with positive gains in August (0.5%). Uncertainty surrounding inflation, Fed tapering, and potential 2022 interest rate hikes continued to be areas of concerns for the bondholders. Global bonds also had a down month of -0.4%.
The broad commodity index had negative returns during August. Silver (-6.2%) and grains (-1.9%) were the top two detractors.
Softs led the index for the month (7.9%), and gold was relatively flat. US REITs had another stellar month and were up 29.3% year to date. Energy was down slightly in August. The impact surrounding Hurricane Ida has yet to be fully realized and remains an area of focus.
Relative to a globally balanced (60/40) equity/bond index, allocations to US REITs and global equites helped while global bonds, commodities and gold hurt for the month.
* “FAANG” is an acronym that refers to the stocks of five prominent American technology companies: Facebook (FB), Amazon (AMZN), Apple (AAPL), Netflix (NFLX); and Alphabet (GOOG)
Source: Zephyr Style Advisor, Bloomberg, Reuters, Forbes, Nasdaq
Check the background of your financial professional on FINRA's BrokerCheck.
The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.
This communication is strictly intended for individuals residing in the states of AL, CA, FL, IN, MT, NC, OH, TX, WA, WV. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services. Securities and Advisory Services Offered Through Commonwealth Financial Network (Privacy Policy), Member FINRA/SIPC and a Registered Investment Advisor, Fixed Insurance Products and Services Offered Through CES Insurance Agency.
IMPORTANT INFORMATION
This report is for informational purposes only, and is not a solicitation, and should not be considered as investment or tax advice. The information has been drawn from sources believed to be reliable, but its accuracy is not guaranteed, and is subject to change.
Investing involves risk, including the possible loss of principal. Pas performance does not guarantee future results. Asset allocation alone cannot eliminate the risk of fluctuating prices and uncertain returns. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio in any given market environment. No investment strategy, such as asset allocation, can guarantee a profit or protect against a loss. Actual client results will vary based on investment selection, timing, and market conditions. It is not possible to invest directly in an index.
Information presented here has been developed by an independent third party, AssetMark, Inc.
AssetMark, Inc. is an investment adviser registered with the Securities and Exchange Commission. (C)2021 AssetMark, Inc. All rights reserved.