Market Commentary

Q3 2021 Market Commentary

After contently watching domestic equity markets hover near all-time highs during most of the third quarter, markets eventually
succumbed to rotating concerns resulting in the S&P 500 pullback of 4.76% during the last month of September. As we remain
confident in market levels supported by fundamentals, we reiterate that such a minor pullback is healthy for overall markets as
we continue forward with our post pandemic recovery. As expected, the Dow Jones Industrial Average has stayed within a
recent trading range of 34,000 to 35,500 absent a major catalyst to drive a breakout in either direction. We continue to observe
consistent patterns of respective buying and selling at both ends of the support & resistance spectrum.

Energy and Financial sectors continue to lead overall markets during 2021, meeting our expectations, with Real Estate rounding
out the top three. The Utility sector remains a disappointment relative to our outlook for this year. After recently reaching double
digit year to date (YTD) returns, the Utility sector gave up a good portion of its gains when bond markets reacted negatively to
further hawkish Fed feedback and inflation red flags. Even though 2021 YTD total return results for the Utility sector remain
unimpressive, it still serves a role as an attractive income generating vehicle with defensive characteristics. Also note that during
the downturn in September, Value oriented companies held up better than Growth stocks, -3%+ versus -5%+, respectively.

As discussions regarding proposed tax law changes and the infrastructure spending bill blur into the D.C. background, inflation
fought its way back to the spotlight with support from significantly higher oil prices. With inflation taking the lead role, we saw the
yield on the 10-year Treasury rise over 1.5%, recently touching 1.6% before pulling back. Inflation sustainability remains a
question due to trendless economic reports, especially employment data.

Understanding employment reports today is likened to understanding why your keys are always in the pocket on the side where
you are holding bags. Note: there is a sub-conscious answer to this mystery. A combination of job creation reports, filing of new
unemployment claims and labor shortage issues presents a challenging new environment for analysis. I just do not recall any
continuing education curriculum within our industry that covers “making logic out of illogical results.” Another persistent
contributing factor to inflation is the existing global supply issue. We believe supply constraints should slowly resolve itself
through 2022 via increased manufacturing and resolution of labor shortages in the transportation sector.

Please note that our next Virtual Round Table Discussion (RTD) has been scheduled for November 10th from 3:00 PM – 4:00
PM. We will be holding in-depth discussions regarding inflation, interest rates, impact of Evergrande as another contagion from
overseas, the national labor shortage/strike, updates on proposed tax law changes/infrastructure bill and other topics. RTD
attendance details are currently being sent out to individuals on our invitee list. If you are interested in participating, please
contact your adviser or Katelyn Baehrle in our main office at 484-320-6300 to be included. Finally, please be sure to reach out to
your adviser should you have any questions pertaining to your personal financial plan or investment portfolio.

Q1 2020 Market Commentary

After hitting all-time highs in February, U.S. equity markets abruptly turned for the worst as discerning news emerged regarding the novel coronavirus. In over a month, the Dow Jones Industrial Average (DJIA) dropped from a record high of 29,500+, to a 52-week low of...

read more

Q4 2019 Market Commentary

As we closed out a phenomenal year for capital markets in 2019, we must admit a sigh of relief could be sensed which was a far cry from the sheer panic experienced the year before. With the memory of a devastating December 2018 fresh on our minds, end of the year...

read more

Q3 2019 Market Commentary

Despite dropping into what we deemed as oversold territory during the month of August, the most recent quarter did close on a positive note. We must admit that as we yearn for clarity over time, we are blindsided by never-ending announcements that continue to drive...

read more

Q2 2019 Market Commentary

The roller coaster ride in equity markets continued through the months of May & June, which can be described as a “miniature” version of last December into January. We did not test recent lows as we did in December, but the volatility reminds us that even in the...

read more

Q1 2019 Market Commentary

The significant recovery in equity markets during the first quarter of 2019 has certainly helped with putting the disastrous end of 2018 behind us. Based upon fundamentals, our Dow Jones Industrial Average (DJIA) targets of...

read more

Q4 2018 Market Commentary

To say that 2018 was a challenging year for capital markets would be putting it mildly. Despite healthy fundamentals, the extreme volatility experienced during the 4th quarter was enough to set new records, both bad and good. Volatility ranged from the worst Christmas...

read more
Share This