We just wrapped up the best quarter for US stocks since the fourth quarter of 2013, with the headline indices all delivering strong performance, despite a variety of challenges. The rate environment continued to challenge fixed income investors, as the bond market was flat for the quarter.
With the aging bull market now in its tenth year, investors are looking for signs that stocks can continue to enjoy gains in a market where shares have looked historically expensive for several years now. As is usually the case, the markets are giving us conflicting signals about its direction, but for now the primary trend still looks higher.
Volatility is back. After one of the least volatile years in stock market history, 2018 is shaping up to be more normal from a volatility perspective – or perhaps even more volatile than normal.
In many ways, 2017 was a tumultuous year, but not when it came to the financial markets. One of the longest bull markets in history shows few signs of slowing down. Depending on how one measures such things, it is now the longest cyclical bull market on record. Expectations were not very high at the beginning of last year.