Market Update
Throughout March, investors worried about the impact of a trade war, rising inflation, and a potential economic recession. Both the personal consumption expenditures (PCE) price index and the Consumer Price Index (CPI) moved little for much of the quarter, however, core prices (excluding volatile food and energy segments) increased on an annual basis, moving farther from the Federal Reserve's 2.0% target rate. In response, the Federal Reserve maintained the federal funds target rate range at 4.25%-4.50%.
The unemployment rate edged up to 4.1% in February. In this context, U.S. stocks declined in March and for the quarter. The S&P 500 lost nearly 5.0%, while the NASDAQ declined over 10.0%.
Among the market sectors, the first quarter saw consumer discretionary fall more than 16.0%, information technology decline about 15.0%, and communication services drop nearly 8.0%. The energy sector was the only one to close March in the black. The dollar index declined under the weight of economic uncertainty. Gold prices, on the other hand, reached a record high. Crude oil prices moved higher after President Trump intimated that additional tariffs on Russia could be in the offing, which could lead to supply concerns.
International Markets
Global markets trended lower in March as concerns over a trade war dampened the economic outlook and curbed investor sentiment. The German inflation rate slowed to 2.2% in March, the lowest it's been since November 2024. The European Central Bank is expected to cut its key interest rate in mid-April as inflation data seems to be heading toward the ECB's 2.0% target. While China's stock market managed to trend higher last month, that country's industrial output fell by 3.6% over the last 12 months, marking the steepest decline since May 2023. In March, the STOXX Europe 600 Index fell 5.1%; the United Kingdom's FTSE declined 3.4%; Japan's Nikkei 225 Index fell 5.7%; and China's Shanghai Composite Index ticked up 0.6%.
On A Personal Note
Jeff and Peggy went to the Mohican State Park area to spend a couple of nights in a treehouse. A storm came through the first night and made for a lot of movement and creaking. Jeff said it just added to the fun. March was spring break for Drew’s daughters, so he took a trip to Cancun, Mexico. Not his favorite tropical location, but you can’t beat the non-stop flight! Chris and his family were busy wrapping up the regular season for gymnastics and ramping up for soccer season. Lisa spent a fun day in Granville, OH at the Bryn Du Art Show looking at beautiful artwork and spending time with one of the artists! Sam’s family came to town in March to enjoy a long weekend together. They spent one afternoon exploring the brewing heritage trail in Over the Rhine. Hearing about the history of Cincinnati and touring the 19th century buildings was a pretty unique experience. Taylor and Peter welcomed their daughter, Charlotte, on 2/28. They have spent the past few weeks in total awe and complete exhaustion.
