The fourth quarter of 2018 saw financial markets experience higher levels of volatility, with large market swings driven in part by geopolitical issues, in part by the ending of quantitative easing by central banks. While many of these issues remain unresolved, Q1 of 2019 has seen global markets enjoy a strong recovery from the turmoil.
The year 2018 was a rocky one for financial markets, serving up a big burst of volatility early in the year, and then following on with new all-time highs in major market indices, only to finish up with another round of gut-wrenching plunges that pushed those same indices right back down.
The third quarter of 2018 saw financial markets respond with bouts of volatility to concerns over trade protectionism and global growth, and guidance from the Federal Open Market Committee that they are on track to raise rates again before year end.
During the second quarter of 2018, financial markets were focused on the vagaries of daily tariff tit-for-tat pronouncements (and tweets) from Washington, leading to concerns of a potential trade war with China, Canada, and the EU. While speculation on the implications of the additional rate hikes from the Federal Reserve impacted fixed income markets.
Global stocks got off to a solid start in January, but February brought a new level of volatility to the markets which has not been seen for quite some time. The synchronized global growth story of 2017 seems to be somewhat challenged in Q1 of 2018 with the presence of several uncertainties surrounding inflation, trade policy, and political tensions.
2017 was another strong year for equities as economies around the world remained in a synchronized global expansion. Despite geopolitical risks and tighter monetary policy, volatility remained near historic lows and markets continued to steadily rise. Momentum performed particularly well in 2017 as large-cap tech stocks repeatedly pulled this market to new highs.
Given the backdrop of this quarter’s market review, we would like to open by acknowledging and paying our respects to the people, families, states, and countries affected by the numerous natural disasters that occurred during the third quarter of 2017. Symmetry’s unwavering dedication to our clients is echoed in our support for those affected by these events.
Market Commentary: Q2 2017
Market Commentary: Q1 2017
2016: Forecasts Foiled Again
Election drama, a Brexit storm and uncertainty surrounding the Fed all did nothing to thwart markets this year, as U.S. stocks continued their march skyward. Small caps in particular had a banner year in 2016, while value paid off substantially as well.