MARKETS
- Global financial markets were positive in April across the board. The developed and emerging market equity index (MSCI ACWI IMI) increased +4.37% in April and +9.14% YTD. The S&P 500, which tracks large cap U.S. stocks, was up +5.34% in April and +11.84% YTD. The Russell 2000 Index, which tracks domestic small cap stocks, increased +2.10% in April and +15.07% YTD. The international developed equity index (MSCI EAFE) increased by +3.01% in April and +6.59% YTD. The emerging markets index (MSCI EM) increased by +2.49% in April and up +4.83% YTD.
- In April, longer-term bond yields decreased: the 30-year U.S. Treasury bond yield decreased by -11bps to 2.30%, the 10-year yield decreased by -9 bps to 1.65%, and the 5-year yield decreased by -6 bps to 0.86%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. bond prices, increased by +79% for April and decreased by -2.61% YTD.
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the first quarter of 2021 increased +6.4%, according to the “advance” estimate released by the Bureau of Economic Analysis. The fourth quarter of 2020 GDP increased +4.3%.
- The April Services PMI (formerly Non-Manufacturing Purchasing Managers Index) decreased to 62.70% from 63.70% in March, which represents expansion at a lower rate and below the market expectations of 64.3%. The April Manufacturing PMI decreased to 60.70% from March’s 64.70%. Per the Institute for Supply Management (ISM), a reading above 50 is considered economic expansion.
- April non-farm employment increased by 266,000 jobs, and the unemployment rate was little changed at 6.1%, as reported by the Bureau of Labor Statistics on May 7, 2021. In April, employment increased in leisure and hospitality, other services and local government education. Average Hourly Earnings (wages) increased +0.3% year-over-year in April.
FUND PERFORMANCE UPDATES
- In April, the Total Equity Fund increased by +4.04% and was up +10.13% YTD. The International Equity Fund increased by +2.94% in April and was up +6.85% YTD. The Small Cap Equity Fund increased by +3.40% in April and was up +14.08% YTD. The Fixed Income Fund increased by +0.95% in April and was down -2.37% YTD.
- All the managers except QMA U.S. Large Cap and RBC Emerging Market outperformed their benchmarks.
- Balanced Funds that outperformed their respective benchmarks were BFF Balanced Fund and Alternatives Balanced Fund in April. The Moderate Balanced Fund, UCF’s most popular fund, increased by +2.84% in April and was up +5.44% YTD. The Aggressive Balanced Fund was up +3.30% in April and was up +7.30% YTD. The Conservative Balanced Fund was up +2.09% in April and was up +2.32% YTD. The Alternatives Balanced Fund was up +4.48% in April and was up +6.43% YTD. Finally, the Beyond Fossil Fuels Balanced Fund increased by +3.07% in April and was up +6.84% YTD.