WILLIAM RIEGEL, CHIEF INVESTMENT OFFICER, TIAA ASSET MANAGEMENT
December 30, 2015
Most global equity markets advanced during the holiday-shortened week. The S&P 500 Index, which rallied on the back of a rebound in oil prices, has risen 3.1% for the year to date through December 29 and is on track for its seventh straight year of positive returns.
In Europe, the broad STOXX 600 Index also got off to a good start but was headed for its worst December since 2002. Meanwhile, Japan’s Nikkei 225 Index concluded its trading year with a return of about 9%, its fourth consecutive annual gain. Stocks in China, however, declined amid signs that government officials are worried about capital flight as the economy slows.
In U.S. fixed-income markets, the yield on the bellwether 10-year U.S. Treasury note, which moves in the opposite direction of its price, rose on thin trading volume, to 2.32%, on December 29. The yield on the two-year note, which has been on an uptrend since the Federal Reserve raised interest rates in mid-December, reached 1.09%, a 5½-year high. Among non-U.S. Treasury “spread” sectors, high-yield bonds notched a modest advance to start the week, trimming their year-to-date loss through December 29 to 4.6%. Returns for other “spread” sectors were broadly negative.
This week was light in terms of U.S. economic reports.
A number of closely watched releases, including the December payrolls report and unemployment rate, are scheduled for the week of January 4 and have the potential to move markets in what should be heavier post-holiday trading.
The next Weekly Market Update will be published on Friday, January 8, 2016.
TIAA-CREF Asset Management provides investment advice and portfolio management services to the TIAA-CREF group of companies through the following entities: Teachers Advisors, Inc., TIAA-CREF Investment Management, LLC, and Teachers Insurance and Annuity Association® (TIAA®). Teachers Advisors, Inc. is a registered investment advisor and wholly owned subsidiary of Teachers Insurance and Annuity Association (TIAA). Past performance is no guarantee of future results.
Foreign stock market returns are stated in U.S. dollars unless noted otherwise.
Please note that equity and fixed income investing involve risk.
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