Market Recap: September 2021

October 05, 2021
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Market Commentary

  • Recovery is on course, but tight labor markets and global supply chain struggles persist
  • Consumer spending is encouraging but consumer confidence is waning
  • Inflation is running at about 4% over the last year, well above the Fed’s 2% target
  • Labor shortages should start to dissipate in coming months as more workers reenter
  • 1 trillion Infrastructure bill is delayed as political crosscurrents collide

Select Economic & Market Data
 

Statistic (monthly unless noted) Current Previous
Consumer Expenditures 0.8% -0.1%
Consumer Confidence 115.2 125.1
Consumer Price Index 0.3% 0.5%
Retail Sales 0.8% -2.2%
Unemployment Rate 5.2% 5.4%
2-Year Treasury Yield 0.29% 0.20%
10-Year Treasury Yield 1.53% 1.30%

 

Equities

  • Stocks enduring rocky stretch as Fed becomes less accommodative
  • Rising Treasury yields having undesirable effect on growth stocks
  • Emerging markets roiled by woes of Chinese property development company Evergrande Group
September 2021 Equities Indices

 

Fixed Income

  • Positive returns are proving sparse in the bond market as Fed changes course
  • Fed signaled reduction in asset purchases in coming months with Fed Funds increases by mid-2022
  • High-yield bonds, whose returns often correlate more closely with stocks, continue their run
September 2021 Fixed Income Indices

 

Strategic Outlook

  • Neutrally positioned on equites, while favoring international over domestic
  • Finding value in select domestic equities while trimming outsized "growth" exposure
  • Maintaining shorter duration fixed income structure as low-yield environment continues
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