The FutureAdvisor performance calculated is net of fees but before trading costs. Differences in account size, age of clients, risk tolerance, timing of transactions and market conditions may lead to different results. Past performance is not indicative of future results. The views expressed are not intended to serve as a forecast, a guarantee of future results, investment recommendations or an offer to buy or sell securities.
The week ending May 30, saw another generally strong week for stocks and bonds. Core US funds rose +1.15% to +1.21% for the week as the S&P 500 hit a new high on Thursday, with developed market funds rising +0.77% to +1.18%. Emerging markets were weaker falling -1.63% to -2.07% driven by weaker prospects for Brazil. Real estate (REITs) rose +0.34% to +0.66% and fixed income performance was generally good ranging between -0.13% and +0.88%.
The economic picture was similar to past weeks. Recent US GDP number for Q1 fell -1.0%, this was worse than expected, and we believe this is primarily weather related. However, despite a weak Q1 more recent data continues to show a return to growth. This week’s data on jobless claims and durable goods showed improvement above expectations. Personal income data was slightly weaker than expected but remaining in positive territory. Internationally, after having a strong start to May, Brazil fell based on falling commodity prices, such as iron ore, which we believe are particularly significant for the economy. Tensions in Ukraine continued, though there are signs that Russia is backing off and the Russian stock index showed very strong growth for May.