Market Recap

1st Quarter 2015


Click image to enlarge

THE BIG PICTURE  

Stocks started 2015 by bouncing around before hitting new all-time highs. With oil prices down 50% and strong employment data, in February stocks rallied. By March, with stocks riding high, investors began to worry the Federal Reserve Bank might tighten credit sooner than expected.

 


Click image to enlarge

U.S. STOCKS

In the first quarter of 2015, mid-cap and small-cap stocks substantially outperformed large-caps, as they had done during the previous quarter. Riskier stocks regarded as “growth” investments outperformed less volatile value-style investments. The favorite style is generally fleeting over the long run.


Click image to enlarge

FOREIGN VS. U.S. STOCKS

U.S. stocks have outperformed foreign markets significantly since the global financial crisis. In 2015Q1, European stocks led. Europe’s outperfomance could presage a change in Europe’s relative performance as the U.S. expansion is now over six-years old.


Click image to enlarge

LARGE-CAP U.S. STOCKS BY INDUSTRY 

Returns on health care stocks for the 12-month period led the 10 S&P 500 industry indices, followed by consumer-discretionary and technology stocks. Just two of the 10 sectors were hit for a loss over the period, indicating of the broad market rally experienced in the year. Energy stocks were slammed .


Click image to enlarge

ASSET CLASSES±

Real estate was the No. 1 performing asset among a broad array of 13 asset classes for the five years ended March 31, 2015. Second best Master Limited Partnerships. U.S. stocks had five great years. Stocks tied oil prices were crushed and commodities as well as European investments trailed.


Click image to enlarge

S&P 500 INDEX VS. EARNINGS¥

Red squares show expected earnings on the S&P 500 index based on a March 31 forecast by Wall Street analysts, for $121 per share in 2015 and $136 in 2016. The trajectory of earnings growth seems posed continue to propel stocks higher — unless a crisis or really bad unexpected news sets world progress back a bit.   

 

   Past performance of investments is not a very reliable indicator of future performance. ± Indices and ETFs representing asset classes are unmanaged and not recommendations for any specific investment. Foreign investing involves currency and political risk and foreign-country instability. Bonds offer a fixed rate of return while stocks fluctuate. ¥ Estimated bottom-up S&P 500 earnings per share as of March 26, 2015 was $120.87 for 2014 and $136.42 for 2016. Sources: Yardeni Research, Inc. and Thomson Reuters I/B/E/S survey of consensus estimates. Standard and Poor’s for index price data through March 31, 2015; and actual earnings data through December 31, 2014.

 

 
  
  

 

4th Quarter 2014
3rd Quarter 2014
2nd Quarter 2014
1st Quarter 2014
4th Quarter 2013

This article was written by a professional financial journalist for Houston Asset Management and is not intended as legal or investment advice.
@2015 Advisor Products Inc. All Rights Reserved.