The yield curve flattened in February, with rates at the short end of the curve increasing while declining at longer maturities. The yield on the 10-year Treasury declined 9 basis points last month to 2.36%. The Barclays Aggregate Bond Index increased in February as both Treasuries and investment grade corporates posted positive returns. High yield bonds, yet again, outpaced more interest-rate-sensitive fixed income sectors. Municipal bonds declined slightly during the month.
The Federal Open Market Committee left the federal funds rate unchanged at its two day meeting that concluded on February 1st. The next meeting will conclude on March 15th and indicators show market participants expect a ¼% rate increase. The second reading of fourth quarter GDP remained at a rate of only 1.9%. Housing was solid, with starts, permits and existing home sales all increasing from the prior month. The ISM Manufacturing and Non-Manufacturing Indices signaled continued improving business conditions, and the University of Michigan Consumer Sentiment Index continued to reflect optimism. Manufacturing was mixed, with durable goods orders rebounding and industrial production declining.
Click here for a PDF of Glenn Dorsey’s Monthly Recap.
Past performance is not indicative of future results. This is not financial advice or an offer to sell any product. Clark Capital Management Group, Inc. reserves the right to modify its current investment strategies and techniques based on changing market dynamics or client needs. It should not be assumed that any of the investment recommendations or decisions we make in the future will be profitable or will equal the investment performance of the securities discussed herein. Clark Capital Management Group, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about Clark Capital’s advisory services can be found in its Form ADV which is available upon request. Material presented has been derived from sources considered to be reliable, but the accuracy and completeness cannot be guaranteed. Nothing herein should be construed as a solicitation to buy, sell or hold any securities, other investments or to adopt any particular investment strategy or strategies. For educational use only. CCM-993