MARKETS:
- Global markets were solid in August, led by U.S. Small Cap and International Developed. The global equity index (MSCI ACWI IMI) was positive at +2.47% in August and was up +14.30% The S&P 500, which tracks large cap U.S. stocks, increased +2.03% in August and was up +10.79% YTD. The Russell 2000 Index, which tracks domestic small cap stocks, increased +7.14% in August and was up +7.06% YTD. The international developed equity index (MSCI EAFE) increased +4.26% in August and was up +22.79% YTD. The emerging markets index (MSCI EM) increased +1.28% in August and was up +19.02% YTD.
- In August, bond yields were mixed across maturities. The 30-year U.S. Treasury bond yield increased +3 bps to 4.92%, the 10-year yield decreased –14 bps to 4.23%, and the 2-year yield decreased -35 bps to 3.59%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. bond prices, increased +1.20% in August and was up +4.99%
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the second quarter of 2025 increased +3.3%, according to the “2nd” estimate released by the Bureau of Economic Analysis. In the first quarter of 2025 GDP decreased by -0.5%.
- The August Services PMI increased to 52.00% from 50.10% in July. This represents expansion. The August Manufacturing PMI increased to 48.70% from 48.00% in July.
- August non-farm employment increased by 22,000 jobs, and the unemployment rate was 4.3%, as reported by the Bureau of Labor Statistics on September 5. In August, employment increased in health care, while the Federal government lost jobs. Average Hourly Earnings (wages) increased +3.7% year-over-year in August.
PERFORMANCE UPDATES
- The Total Equity Fund increased +3.16% in August and was up +13.52% YTD. The International Equity Fund increased +3.50% in August and was up +21.65% YTD. The Small Cap Equity Fund increased +5.98% in August and was up +6.03% YTD. The Fixed Income Fund increased +1.25% in August and was up +5.03% YTD.
- Equity managers, representing a larger portion of assets, outperformed, led by PGIM Quant U.S. and Global, BlackRock SC, LSV Int’l and RBC EM.
- The UCF Balanced Fund returned +2.36% in August and was up +10.00% YTD. The Alternatives Balanced Fund increased by +1.94% in August and was up +8.78% YTD. Finally, the Beyond Fossil Fuels Balanced Fund outperformed its benchmark, returning +2.63% in August, and was up +11.46% YTD.