- Global financial markets were mostly negative in November across the markets. The developed and emerging market equity index (MSCI ACWI IMI) decreased -2.41% in November and increased +13.98% YTD. The S&P 500, which tracks large cap U.S. stocks, decreased -0.69% in November and increased +23.18% YTD. The Russell 2000 Index, which tracks domestic small cap stocks, decreased –4.17% in November and increased +12.31% YTD. The international developed equity index (MSCI EAFE) decreased -4.65% in November and increased +5.84% YTD. The emerging markets index (MSCI EM) decreased -4.08% in November and decreased -4.34% YTD.
- In November, longer-term bond yields were mixed: the 30-year U.S. Treasury bond yield decreased by –15 bps to +1.78%; the 10-year yield decreased by -12 bps to +1.43%; and the 5-year yield decreased by -4 bps to +1.14%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. bond prices, increased +30% in November and decreased -1.29% YTD.
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the third quarter of 2021 increased +2.1%, according to the “2nd” estimate released by the Bureau of Economic Analysis. GDP in the second quarter of 2021 increased +6.7%.
- The November Services PMI (formerly Non-Manufacturing Purchasing Managers Index) increased to 69.10% from 66.70% in October, which represents expansion at a higher rate and above the market expectations of 65.00%. The November Manufacturing PMI increased to 61.10% from October’s 60.80%. Per the Institute for Supply Management (ISM), a reading above 50 is considered economic expansion.
- November non-farm employment increased by 210,000 jobs, and the unemployment rate decreased to 4.2%, as reported by the Bureau of Labor Statistics on December 3, 2021. In November, employment increased in professional and business services, transportation and warehousing, construction, and manufacturing. Average Hourly Earnings (wages) increased +4.8% year-over-year in November.
UCF FUND PERFORMANCE UPDATES
- In November, the Total Equity Fund decreased by -2.44% and was up +12.95% YTD. The International Equity Fund decreased by -3.71% in November and was up +3.40% YTD. The Small Cap Equity Fund decreased by -4.96% in November and was up +9.62% YTD. The Fixed Income Fund decreased by -0.10% in November and was down -1.70% YTD.
- The equity managers that outperformed their respective benchmarks in November were SSGA, RBC, LSV and Baillie Gifford. The managers that underperformed the benchmarks in November were QMA, Westfield, Blackrock and Channing.
- The Balanced Funds performed mostly in line with their benchmarks. The UCF Balanced Fund, UCF’s most popular fund, decreased by -1.62% in November and was up +7.34% YTD. The Aggressive Balanced Fund was down -1.95% in November and was up +9.52% YTD. The Conservative Balanced Fund was down -1.04% in November and was up +3.70% YTD. The Alternatives Balanced Fund was down -1.56% in November and was up +9.31% YTD. Finally, the Beyond Fossil Fuels Balanced Fund decreased by -1.10% in November and was up +10.13% YTD.