Market Commentary: Third Quarter

Global markets have continued to recover from the COVID-19 Pandemic.  Large companies represented by the S&P 500 Index have continued to outperform almost everything else and gained 8.93% for the quarter, and are up 5.57% YTD. Small companies represented by the Russell 2000 increased 4.93% for the quarter, but are still down 8.7% YTD.  International stocks represented by the iShares MSCI EAFE Index increased 4.8% for the quarter, but are still down 7.1% YTD. The Federal Reserve has indicated that there will not be any interest rate increases in the foreseeable future, and The Barclays US Gov/Credit 1-5 Year Index was up 0.37% for the quarter, and 4.36% YTD.

Unemployment numbers which grew at an unprecedented rate from 4% to over 15% in just about one month’s time have now decreased to 7.9% according to the U.S. Bureau of Labor Statistics.  COVID-19 is still affecting our lives, with a large percentage of the workforce working remotely and school age children learning remotely.  Congress has brought a few stimulus bills to the negotiating table, but an approval seems unlikely as the political season ramps up to election day.

As we enter the policial season, it is important to stay calm as our personal beliefs around politics can force emotionally bad decisions.  Historically, the political party that occupied the presidency has had little net effect on the performance of stocks. As election day gets closer however, more investors get nervous about the “other party” winning, and what will happen to taxes, investments, health care, and other things that are important to them individually.  

Your Petersen Hastings advisor has worked with you to develop an investment mix that is appropriate for helping you achieve your financial goals, and it is important to stay the course so your investments stay on track.

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