Hi All — Brian here. Welcome to April. The first quarter of the year is officially in the books and it was a wild one to say the least. The S&P 500 finished the three month stint down 4.63% while the Nasdaq Composite fell over 10%. The Dow Jones Industrial Average was the relative outperformer, but still ended the first three months of the year lower by 1.3%. Uncertainty around the Trump administration’s economic plans created a roller coaster ride for market participants since the start of the year.

As we begin the second quarter, we’re hopeful that April is a bit more upbeat. While it’s imperative to remember that past performance is not a guarantee of future results, April has historically been the second-strongest month for stocks. The S&P 500 has finished higher roughly two-thirds of the time.

Regardless of the outcome, this quote from John Bogle comes to mind. The investor and mutual fund industry pioneer once said:

“Regardless of what happens in the markets, stick to your investment program. Changing your strategy at the wrong time can be the single most devastating mistake you can make as an investor.”

This echos what we published in our client memo on Wednesday, which is worth reiterating today: it is paramount to recognize that the paper losses in your portfolios will become real losses only if you sell.

We do not recommend broad selling in an emotional and volatile time like the present. Our long-time recommendation for clients has, historically, been to stay invested in equities during economic downturns.

If you missed our client memo or you would like a copy, please send me an email.

And as always, we are here to support you, so please don’t hesitate to schedule a call or reply directly to this email if you’d like to discuss any of these topics in more detail.

MARCH MARKET PERFORMANCE

MARCH MARKET SUMMARY

• The S&P 500 and Nasdaq Composite recorded their worst quarterly performance since December 2022.

• The Magnificent Seven stocks specifically weighed on overall market performance. The high profile names had previously driven markets higher during the bull run. But Tesla, for example, shed 36% in the first quarter and Nvidia fell almost 20%.

• Interestingly, the energy sector outperformed during the first quarter, delivering a total return of 9.9% buoyed by strong pricing power. Gold prices also posted remarkable gains, rising 19% for the first three months of the year.

• According to the University of Michigan, US consumers don’t have a particularly great outlook on the economy. The headline index clocked in at 57, which is the lowest level since 2022. Moreover, two-thirds of respondents are predicting higher unemployment in the next year. This is the highest reading since 2009.

• Last but not least, core PCE, or personal consumption expenditures, posted a 0.4% increase in February, which is the most recent reading. The key Fed inflation measure put the 12-month rate at 2.8%. Both figures were higher than expected.

ONE BIG THING: CONSUMER SENTIMENT

The volatility of the past few months finally caught up with consumers in March.

The Conference Board’s Consumer Confidence Survey crashed to a 12-year low last month. A comparable gauge from the University of Michigan plummeted as well. In March, its headline reading fell nearly 30% year-over-year, while future expectations slumped to their lowest level since the start of the pandemic.

There were several potential pain points to blame for the decline. Stickier-than-expected inflation data, warning signs of a spending slowdown, uncertainty regarding President Donald Trump’s tariff policies, and unrest surrounding federal job cuts all contributed to consumers’ cloudy outlook on the future of their finances.

Investors weren’t immune to the souring sentiment either. Many market observers pointed to the above as recessionary red flags, and stocks sold off, particularly in tech-adjacent sectors as traders rotated into defensive stocks. All three major indexes finished down on the month.

Analysts are divided on whether the aforementioned concerns are justifiable or overblown. Whatever the case, roughly two-thirds of the economy’s growth hinges on spending, so the mood among consumers is always worth watching.

FEATURED POST

The Economic Impact of a ‘Horizontal Wealth Transfer’ From Men to Women

A “great wealth transfer” is underway. Over the next two decades, an estimated $84 trillion is expected to be passed down from the older generations to their younger cohorts. Much has been made about the financial implications of this phenomenon for millennials, who stand to inherit the bulk of those funds.

But another demographic might see those benefits much sooner. Before the great wealth transfer, some economists expect a “horizontal wealth transfer”, from male Americans to their female spouses.

Baby boomer men are typically older than their wives. So their wealth may be left in the hands of the family matriarch, before being passed to their children. U.S. women are estimated to receive $9 trillion of the wealth transfer over the coming years. Here’s how that might impact the broader economy.

Click here to keep reading →

KEEP READING

CLOSING REMARKS

Our team at Griffin Asset Management is here to help you make the most of the opportunities and challenges ahead.

If you have any questions or would like to discuss your financial strategy, please don’t hesitate to reach out.

We’re always available to set up a call and provide the personalized advice you need. Thank you for your continued trust and partnership.