- Markets across the globe saw a sharp downturn in April as concerns around inflation, supply chain and geopolitical risks continued. The developed and emerging market equity index (MSCI ACWI IMI) decreased –8.00% in April and -12.94% YTD. The S&P 500, which tracks large cap U.S. stocks, was down -8.72% in April and -12.92% YTD. The Russell 2000 Index, which tracks domestic small cap stocks, decreased –9.91% in April and -16.69% YTD. The international developed equity index (MSCI EAFE) decreased -6.47% in April and -12.00% YTD. The emerging markets index (MSCI EM) decreased –5.56% in April and -12.15% YTD.
- In April, longer-term bond yields increased: the 30-year U.S. Treasury bond yield increased by +52 bps to +2.96%, the 10-year yield increased by +57 bps to +2.89%, and the 5-year yield increased by +50 bps to +2.92%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. bond prices, decreased -3.79% in April and -9.50% YTD.
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the first quarter of 2022 decreased -1.4%, according to the “advance” estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2021, GDP increased +6.9%.
- The April Services PMI (formerly Non-Manufacturing Purchasing Managers Index) decreased to 57.10% from 58.30% in March, which represents expansion at a lower rate and lower than market expectations of 58.50%. The April’s Manufacturing PMI decreased to 55.40% from March’s 57.10%. Per the Institute for Supply Management (ISM), a reading above 50 is considered economic expansion.
- April’s non-farm employment increased by 428,000 jobs, and the unemployment rate stayed the same at 3.6%, as reported by the Bureau of Labor Statistics on May 6, 2022. In April, employment increased in leisure and hospitality, transportation and warehousing, and manufacturing. Average Hourly Earnings (wages) increased +5.5% year-over-year in April.
- In April, the Total Equity Fund decreased -8.25% and -14.97% YTD. The International Equity Fund decreased -7.49% in April and -17.54% YTD. The Small Cap Equity Fund decreased -9.07% in April and -15.75% YTD. The Fixed Income Fund decreased ‑3.51% in April and -8.70% YTD.
- Equity managers had mixed performance in April. Managers that outperformed their benchmarks were PGIM (formerly QMA), SSGA, Westfield, Blackrock and LSV; whereas managers that underperformed their benchmarks were Channing, Baillie Gifford and RBC.
- The UCF Balanced Fund (formerly Moderate Balanced Fund), UCF’s most popular fund, slightly underperformed its benchmark, and decreased -6.25% in April and -12.20% YTD. The Alternatives Balanced Fund decreased -3.72% in April and -7.90% YTD. Finally, the Beyond Fossil Fuels Balanced Fund outperformed its benchmark, decreasing -5.50% in April and -10.56% YTD.