Third Quarter 2018 Market Review

US Stock Market: +7.1%
International Developed Stocks: +1.3%
Emerging Markets Stocks: -1.1%
Global Real Estate: 0%
US Bond Market: 0%
Global Bond Market ex US: -.2%

3Q 2018 Stock Market Review

US Markets continued to surge as international and emerging market stock funds stayed pat for the quarter. Global trade war tensions late in the quarter put a damper on an otherwise very hot summer.

3Q 2018 Fixed Income Review

Bond funds remained flat as interest rates continued to climb amidst trade war tensions.

The Federal Reserve raised interest rates for the eighth time since 2015, bumping rates to a range between 2% and 2.25%.

Ten-year government bond yields gained 30 bps to end the quarter at 3.06%; notably, this is the first time that ten-year government bonds have ended the quarter north of 3% since 2013.

3Q 2018 Global Economics

In terms of global trade, the bright spot of the quarter was the completion of the long-awaited trilateral trade agreement between United States, Mexico, and Canada. This victory was largely overshadowed by the escalating trade war between the United States and China.

On September 24th, 2018 the United States proved they were done playing nice by implementing the most aggressive tariff policy against China so far. The new $200 billion tariffs against China brings the year-to-date total to $250 billion.

Overview of 2018 U.S. Tariffs on China

July 6th, 2018 - 25% tariff is put on $34 billion of Chinese goods.

August 23th, 2018 - 25% tariff is put on $16 billion of Chinese goods, bringing the year-to-date total to $50 billion.

September 24th, 2018 - 10% tariff is put on $200 billion of Chinese goods rocketing the YTD total to $250 billion. These tariffs are scheduled to increase to 25% on January 1st, 2019.

Year-to-date China has placed $110 billion of their own tariffs on US goods.