April 24, 2019 Market Update for the Quarter Ending March 31, 2019
Strong March caps great start to the year
All three major U.S. equity markets were positive for March. The Nasdaq Composite led with a return of 2.70 percent. The S&P 500 and the Dow Jones Industrial Average (DJIA) had gains of 1.94 percent and 0.17 percent, respectively. For the quarter, the Nasdaq, S&P 500, and DJIA gained 16.81 percent, 13.65 percent, and 11.81 percent, respectively.
Market fundamentals worsened. The first-quarter earnings growth estimate for the S&P 500 fell from 2.9 percent to a loss of 3.9 percent. Analysts do expect positive earnings growth for the next three quarters, however.
From a technical perspective, all three major U.S. indices spent much of January and parts of February below their 200-day moving averages. But they ended the quarter above this important technical level.
For international markets, the MSCI EAFE Index gained 0.63 percent for March and 9.98 percent for the quarter. The MSCI Emerging Markets Index gained 0.86 percent for March and 9.97 percent for the quarter. Both indices finished the period above their trend lines.
In fixed income, the Bloomberg Barclays U.S. Aggregate Bond Index gained 1.92 percent for the month and 2.94 percent for the quarter as yields declined and prices rose. The 10-year U.S. Treasury yield started the quarter at 2.66 percent and finished at 2.41 percent.
High-yield bonds, as measured by the Bloomberg Barclays U.S. Corporate High Yield Index, gained 0.94 percent in March and 7.26 percent for the quarter.
Economic growth slows—but continues
Only 20,000 new jobs were added in February, a sign that job growth could be slowing. Employment growth accelerated at year-end before falling in 2019 (see Figure 1).
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