Market Data Bank

2Q 2019


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S&P 500 SURGES SHARPLY IN 2Q2019 Stock returned +4.3% in 2Q2019, after a +13.7% gain in 1Q 2019, and a 4Q2018 loss of -13.5%. The S&P 500 stock index posted a +7.7% total return in 3Q2018, +3.4% in 2Q, and a -0.8% loss in 1Q2018. Share prices broke a new all-time record high, retreated sharply, and surged again to a new all-time high in a volatile quarter.

 

 


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PLUNGE ENDED 9-YEAR 11-MONTH BULL RUN

U.S. stocks, over the 12 months ended June 30, 2019, returned +10.4%. But the one-year period was interrupted by a bear market drop - a 19.8% drop, qualifying as the first bear market in nine years and 11 months. World stock markets were rocked in this 12-month period by a looming U.S. and China trade war.

 


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INDEXES TRACKING 13 ASSET CLASSES

The S&P 500 index's total return of +68% over the five years shown was almost four times the S&P Global ex-U.S. stock market's return of +18%. Relative to the rest of the world and a broad range of asset classes over the five years ended June 30, 2019, the U.S. economy and stock market have performed exceptionally.

 


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INDEXES TRACKING 13 ASSET CLASSES

The S&P 500 index's total return of +68% over the five years shown was almost four times the S&P Global ex-U.S. stock market's return of +18%. It is testament to how resiliently the U.S. economy came out of the last severe global recession and U.S. growth outpaced other world economies and asset classes.

 


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VOLATILITY & REALITY

Stocks were more volatile in the 12 months ended June 30, 2019. The trade war with China and yield curve inversion threaten to end the longest economic expansion in U.S. post-War history and a bull market. Consumers are spending, and wages after taxes and inflation stayed strong.

 


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EQUITY RISK PREMIUM

The equity risk premium - the extra return annually averaged for investing in America's 500 largest publicly-held companies in the 21 -years was + 5.36%. The difference between the 7.3% return averaged annually on the S&P 500 and the 1.94% return on a "risk-free" T-Bill was 5.36%. Stocks were a risk that paid off.

 

 

 

Past performance is never a guarantee of your future results. Indices and ETFs representing asset classes are unmanaged and not recommendations. Foreign investing involves currency and political risk and political instability. Bonds offer a fixed rate of return while stocks fluctuate. Investing in emerging markets involves greater risk than investing in more liquid markets with a longer history.

 

 

 

 

 

 

 

Disclaimer

Howard Materetsky, Ira S. Materetsky CFP®, Matt Welsh and Mark Furman offer advisory products and services through Materetsky Financial Group, a registered investment advisor. Securities offered through Private Client Services, Member FINRA/SIPC. Materetsky Financial Group is not affiliated with Private Client Services. Tom Gau offers advisory products and services through Materetsky Financial Group, a registered investment advisor.

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