Stock markets globally delivered strong returns in the first quarter, driven by a combination of powerful forces: the expectation of easy monetary policy from central banks and a continued broadening of the narrative that artificial intelligence (AI) will have a majorly positive impact on companies’ profits. Bonds were the only asset not to rally, ending up slightly negative.

Stock markets globally delivered strong returns in the first quarter, driven by a combination of powerful forces: the expectation of easy monetary policy from central banks and a continued broadening of the narrative that artificial intelligence (AI) will have a majorly positive impact on companies’ profits. Bonds were the only asset not to rally, ending up slightly negative.

Stock markets globally delivered strong returns in the first quarter, driven by a combination of powerful forces: the expectation of easy monetary policy from central banks and a continued broadening of the narrative that artificial intelligence (AI) will have a majorly positive impact on companies’ profits. Bonds were the only asset not to rally, ending up slightly negative.

While inflation numbers on paper are coming down, many households are scratching their heads wondering why it feels like life is still becoming more expensive, even relative to growing incomes. The reason is that the cost of services and housing remain the fastest growing segments of data, while the cost of goods is declining.

The third quarter was characterized by volatility as the stock and bond markets fell in tandem. Inflation, while beginning to cool, continued to vex the Federal Reserve, and bond yields rose, threatening to choke off growth in the global economy.

Following the turmoil of 2022, U.S. equities led a substantial rally in the first half of 2023, with growth stocks making a remarkable recovery.

As we reflect on the first quarter of 2023, we are reminded that change is the only constant in life. The dynamic economy and financial markets have presented fresh challenges, and understanding the key takeaways and their implications for the future is essential.

The economic backdrop in 2022 reminds us that paradigm shifts can happen and revert back to what was once normal. Portfolio allocations that worked in the decade before 2022 may not be the way of the future, and market participants would be wise to manage their risk carefully moving forward.

After a strong showing in July, stocks and bonds continued their descent in the third quarter as persistent inflation and rising interest rates drove investors’ worries of a global hard landing recession.

It was a brutal first half of the year for stock and bond markets across the board, as inflation remains stubbornly high and the Federal Reserve continues to raise interest rates, putting the U.S. economy at risk of a recession.