By Glenn Dorsey, CFA, CAIA, Clark Capital
Stocks added to January’s gains during the month of February as the post-election rally continued. The S&P 500 increased 3.97% for the month, while small cap stocks, as measured by the Russell 2000, increased a more modest 1.93%.
Growth stocks (+4.02%) edged out value stocks (+3.42%) for the month. Developed international stocks increased by 1.62%, while emerging market stocks increased by 3.06%.
Fixed income markets were positive in February. The yield curve flattened as yields increased for bonds with short maturities and decreased for bonds with longer maturities. The yield on the benchmark 10-year Treasury declined 9 basis points to 2.36% during the month, while the yield on the 2-year Treasury increased 3 basis points to 1.22%.
The Barclays Aggregate Bond Index increased by 0.67% for the month. Credit once again outperformed as investment grade bonds increased by 1.15% and outpaced Treasuries’ increase of 0.49%. The Barclays High Yield Index again outperformed and increased by 1.46%. Municipals decreased 0.57% during the month.
Equity Markets
The post-election rally continued as stocks increased again in February. Duplicating last month, large caps stocks continued to outpace small cap stocks and growth stocks outperformed value stocks. International equities underperformed domestic stocks, with emerging markets outperforming developed international markets.
Fixed Income Markets