MARKETS:
- International equity markets continued to outperform U.S. equity markets during the month. The global equity index (MSCI ACWI IMI) increased +1.04% in December and was up +22.34% in 2025. The S&P 500, which tracks large cap U.S. stocks, increased +0.06% in December and was up +17.88% for 2025. The Russell 2000 Index, which tracks domestic small cap stocks, decreased -0.58% in December and was up +12.81% for 2025. The international developed equity index (MSCI EAFE) increased +3.00% in December and was up +31.22% for 2025. The emerging markets index (MSCI EM) increased +2.99% in December and was up +33.57% for 2025.
- In December, bond yields were mixed across maturities. The 30-year U.S. treasury bond yield increased +17 bps to 4.84%; the 10-year yield increased 16 bps to 4.18%; and the 2-year yield was flat at 3.47%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. bond prices, decreased -0.15% in December and was up +7.30%
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the third quarter of 2025 increased +4.3%, according to the “initial” estimate released by the Bureau of Economic Analysis.
- The December Services PMI increased to 54.40% from 52.60% in November. The December Manufacturing PMI decreased to 47.90% from 48.20% in November.
- December non-farm employment increased by 50,000 jobs, and the unemployment rate was little changed at 4.4%, as reported by the Bureau of Labor Statistics on January 9. In December, employment increased in health care, food services and drinking places, and social assistance. Average Hourly Earnings (wages) increased +3.8% year-over-year in December.
PERFORMANCE UPDATES*
- The Total Equity Fund increased +1.24% in December and was up +21.66% for 2025. The International Equity Fund increased +3.63% in December and was up +32.73% for 2025. The Small Cap Equity Fund decreased -0.78% in December and was up +11.37% for 2025. The Fixed Income Fund decreased -0.08% in December and was up +7.36% for 2025.
- Most equity managers outperformed in the month, except for BlackRock Small Cap and Baillie Gifford International.
- The UCF Balanced Fund returned +0.71% in December and was up +15.69% for 2025. The Alternatives Balanced Fund increased +0.70% in December and was up +14.60% for 2025. Finally, the Beyond Fossil Fuels Balanced Fund returned +0.91% in December and was up +17.27% for 2025.
* These numbers are preliminary and do not reflect final fund performance data.