Quarterly Commentary – Second Quarter 2019
“We’ve always had economic cycles and I believe we always will.” – Howard Marks
U.S. equity markets once again proved resilient in the second quarter, as a May selloff was quickly followed by one of the best June’s on record. The S&P 500 ended the quarter at new highs and with total returns of 10% over the trailing 12-month period. These returns were achieved despite a 20% correction in the fourth quarter of last year and a 7% drawdown in May. Not surprisingly, recent volatility has been highly correlated to trade war news. Similarly, recent rallies have been highly correlated to the Federal Reserve and investor expectations for easy monetary policy going forward.