MARKETS:
- Global markets continue to rally on strong tech earnings and easing geopolitical concerns. The global equity index (MSCI ACWI IMI) increased +5.05% in May and was up +12.66% The S&P 500, which tracks large cap U.S. stocks, increased +5.26% in May and was up +11.27% YTD. The Russell 2000 Index, which tracks domestic small cap stocks, increased +4.37% in May and was up +18.15% YTD. The international developed equity index (MSCI EAFE) increased +3.07% in May and was up +9.37% YTD. The emerging markets index (MSCI EM) increased +9.69% in May and was up +25.61% YTD.
- In May, bond yields increased across maturities. The 30-year U.S. treasury bond yield increased +1 bps to 4.99%; the 10-year yield increased +5 bps to 4.45%; and the 2-year yield increased +10 bps to 3.98%. The Bloomberg U.S. Aggregate Index, which is a measure of U.S. bond prices, increased +0.31% in May and was up +0.38% YTD.
ECONOMIC AND GEOPOLITICAL HEADLINES
- According to the Bureau of Economic Analysis, U.S. real gross domestic product (GDP) increased in the first quarter of 2026 by +1.6%, up from the 4th quarter 2025 increase of +0.5%.
- The May Services PMI was 54.50%, up +0.90% from April. The May Manufacturing PMI was 54.00%, up +1.30% from April. Per the Institute for Supply Management (ISM), a reading above 50 is considered economic expansion and below 50 is considered economic contraction.
- As reported by the Bureau of Labor Statistics on June 5, May non-farm employment increased by 172,000 jobs, and the unemployment rate remained unchanged at 4.30%. In May, employment increased in health care, leisure and hospitality, and local government. Employment in financial activities declined. Average Hourly Earnings (wages) increased by 3.40% year-over-year.
PERFORMANCE UPDATES
- The Total Equity Fund increased +4.53% in May and was up +12.34% The International Equity Fund increased +4.65% in May and was up +12.11% YTD. The Small Cap Equity Fund increased +2.35% in May and was up +17.40% YTD. The Fixed Income Fund increased +0.25% in May and was up +0.27% YTD.
- Most managers underperformed their respective indices during the month due to the narrow tech rally.
- The UCF Balanced Fund increased +2.90% in May and was up +7.57% The Alternatives Balanced Fund increased +3.19% in May and was up +8.60% YTD. Finally, the Beyond Fossil Fuels Balanced Fund increased +3.20% in May and was up +8.17% YTD.