Most major markets closed higher in November as optimism on a trade resolution with China once again dominated the news cycle. U.S. equity markets, bolstered by favorable earnings and reduced recession fears, lead the way with large and small companies gaining; up 3.6% and 4.1%, respectively. International markets were mixed with the MSCI EAFE +1.1% while emerging markets declined -0.2%. Overall the MSCI All Country World Index close November +2.4% for the month and +22.3% year to date.
After the 10 year Treasury yield reached a low of 1.46% in September, prices have retreated with the yield rising to 1.78% at month-end. As yields rose, bond returns were mostly negative for November with the Barclays Aggregate Bond Index -0.1% for November.
To date, 96% of the companies in the S&P 500 have reported results for the 3rd quarter, with 75% of companies reporting actual earnings above expectations. The U.S. economy heads toward year-end on solid footing with upwardly revised 3rd quarter GDP growth of 2.1% along with solid consumer spending and factory goods orders. While no agreement has been reached as we write this, investors will be monitoring trade discussions closely as we approach the December 15th deadline for a new round of tariffs on Chinese goods.
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