August 17, 2020 · 8/17/2020 · PMC Weekly Market Brief 3 August 17, 2020 0 500 1000 1500 2000...

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Chart of the Week

Economic Week Ahead

August 17, 2020

MON August202017

TUE August 202018

• Mortgage applicationsWED August 202019

• Jobless Claims• Philly Fed Outlook: August (estimated 22.0)• LEI

THU August 202020

FRI August 202021

• Housing Starts: July (estimated 1.3)

• Existing Sales: July (estimated 5.5)

• NY Manufacturing: August (estimated 18.0)

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Aug-19 Oct-19 Dec-19 Feb-20 Apr-20 Jun-20

Thou

sand

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Non-Farm Payrolls-Trailing 12 Mos.

Source: Bloomberg


PMC Weekly Market Brief

2

August 17, 2020

L

S

Source: Bloomberg

0.73% 0.61% 0.52%

1.12% 0.61% -0.34%

4.89%-5.43%-16.53%

One WeekValue Growth

1.59% 0.55% -0.43%

YTDValue Growth

-11.02% 7.45% 22.59%

-11.82% -2.21% 11.79%

0

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1000

1500

2000

2500

3000

3500

4000

2/18 3/3 3/17 3/31 4/14 4/28 5/12 5/26 6/9 6/23 7/7 7/21 8/4

Source: Bloomberg

S&P 500 Index: Trailing 180 Days

% Wgt in S&P 500

Week % Chg. YTD % Chg.

Consumer Discretionary 11.2 1.56% 20.2%Consumer Staples 7.0 0.86% 1.5%Energy 2.6 2.28% -37.1%Financials 10.0 1.29% -18.4%Health Care 14.3 0.33% 4.6%Industrials 8.3 3.10% -4.8%Information Technology 27.5 0.10% 24.2%Materials 2.6 1.53% 2.1%Real Estate 2.7 -1.82% -7.5%Communication Services 10.9 -0.25% 8.4%Utilities 3.0 -2.08% -6.9%

Source: Bloomberg

Sector Performance: S&P/Global Industry Classification Sectors (GICS)

Last Price Change % Chg. YTD % Last Price Change % Chg. YTD %S&P 500 3,372.85 21.57 0.64% 4.4% MSCI EM 1,096.18 6.86 0.63% -1.7%Dow Industrials 27,931.02 497.54 1.81% -2.1% 10-Year US Treas. 0.71 15 bps NM NMNasdaq 11,019.30 8.32 0.08% 22.8% Bloomberg Cmdts. Idx. 70.81 0.36 0.51% -12.5%Russell 2000 1,577.88 8.69 0.55% -5.4% Gold $1,945.12 -$90.35 -4.44% 28.2%Euro Stoxx Index 368.07 4.52 1.24% -11.5% Crude Oil $42.24 $0.94 2.28% -27.0%Shanghai Composite 3,360.10 6.06 0.18% 10.2% Dollar Index 93.09 -0.32 -0.35% -3.4%MSCI ACWI 570.82 7.58 1.35% 1.0% VIX Index 22.05 -0.21 -0.95% 59.7%Source: Bloomberg; Index % change is based on price.

Market Dashboard

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Jul-18 Sep-18 Nov-18 Jan-19 Mar-19 May-19 Jul-19 Sep-19 Nov-19 Jan-20 Mar-20 May-20 Jul-20Source: Bloomberg

Wealth Index|Growth of $1: Trailing 24 Months

S&P 500 Dow Industrials Small Cap EAFE Emerging Mkts.

10

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30

40

50

60

70

80

90

Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20Source: Bloomberg

VIX Index: Trail ing 180 Days



3

August 17, 2020

0

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5/22 6/5 6/19 7/3 7/17 7/31

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Initial Jobless Claims-Trailing 12 Wks.

Source: Bloomberg

Economic Data

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-0.8

-0.6

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0

0.2

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0.8


Mon

thly

% C

hg.

Consumer Price Index-Trailing 12 Mos.

Headline CPI Core CPISource: Bloomberg

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0


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Consumer Board Confidence Index - Trailing 12 Mos.

Source: Bloomberg

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5000

10000


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sand

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Non-Farm Payrolls-Trailing 12 Mos.

Source: Bloomberg

-35.0

-30.0

-25.0

-20.0

-15.0

-10.0

-5.0

0.0

5.0

10.0

Sep-17 Mar-18 Sep-18 Mar-19 Sep-19 Mar-20

%

Real GDP Growth Rate - Annualized - 12 Qtrs.

Source: Bloomberg

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0


%

Unemployment Rate-Trail ing 12 Mos.

Source: Bloomberg


PMC Weekly Market Brief August 17, 2020

4

Last Change % Chg. YTD % Last Change % Chg. YTD %Germany 10-Yr. Govt. -0.42 -9 bps NM NM France 10-Yr. Govt. -0.13 -9 bps NM NMGreece 10-Yr. Govt. 1.13 -11 bps NM NM Ireland 10-Yr. Govt. -0.08 -7 bps NM NMItaly 10-Yr. Govt. 0.99 -6 bps NM NM Portugal 10-Yr. Govt. 0.37 -8 bps NM NMSpain 10-Yr. Govt. 0.35 -9 bps NM NM Netherlands 10-Yr. Govt. -0.30 -10 bps NM NMBelgium 10-Yr. Govt. -0.15 -9 bps NM NM U.K. 10-Yr. Govt. 0.24 -14 bps NM NM

SELECTED EUROPEAN SOVEREIGN YIELD PERFORMANCE

Source: BloombergBasis points (bps)

Eurozone

-0.60

-0.50

-0.40

-0.30

-0.20

-0.10

0.00

5/18 6/1 6/15 6/29 7/13 7/27 8/10

%

Germany 10-Year Government Bond Yield

Source: Bloomberg

0.0

0.1

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0.5

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0.7

0.8

0.9

5/18 6/1 6/15 6/29 7/13 7/27 8/10

%

Spain 10-Year Government Bond Yield

Source: Bloomberg

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

5/18 6/1 6/15 6/29 7/13 7/27 8/10

%

Italy 10-Year Government Bond Yield

Source: Bloomberg

0.0

0.5

1.0

1.5

2.0

2.5

5/18 6/1 6/15 6/29 7/13 7/27 8/10

%

Greece 10-Year Government Bond Yield

Source: Bloomberg



5

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8,000

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12,000

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

xNasdaq Composite-Trailing 90 Days

Source: Bloomberg

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3,500

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5/18 6/1 6/15 6/29 7/13 7/27 8/10

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Shanghai Composite Index-Trailing 90 Days

Source: Bloomberg

Equities

Last Change % Chg. YTD % Last Change % Chg. YTD %S&P 500 3,372.85 21.57 0.64% 4.40% Swiss Market Index 10,163.60 95.57 0.95% -4.27%Dow Industrials 27,931.02 497.54 1.81% -2.13% CAC 40 Index (France) 4,962.93 73.41 1.50% -16.98%Nasdaq Composite 11,019.30 8.32 0.08% 22.81% DAX Index (Germany) 12,901.34 226.46 1.79% -2.62%MSCI ACWI 570.82 7.58 1.35% 1.0% Irish Overall Index 6,380.31 102.05 1.63% -11.18%MSCI EM 1,096.18 6.86 0.63% -1.7% Nikkei 225 23,289.36 871.21 3.89% -1.55%S&P/TSX (Canada) 16,514.61 -29.86 -0.18% -3.22% Hang Seng Index 25,183.01 651.39 2.66% -10.67%Mexico IPC 38,949.88 897.13 2.36% -10.65% Shanghai Composite 3,360.10 6.06 0.18% 10.16%Brazil Bovespa 101,353.40 -1422.00 -1.38% -12.36% Kospi Index (S. Korea) 2,407.49 55.82 2.37% 9.55%Euro Stoxx 600 368.07 4.52 1.24% -11.49% Taiwan Taiex Index 12,795.46 -33.41 -0.26% 6.65%FTSE 100 6,090.04 57.86 0.96% -19.26% Tel Aviv 25 Index 1,415.54 12.54 0.89% -15.91%

IBEX 35 (Spain) 7,154.30 203.80 2.93% -25.08% MOEX Index (Russia) 3,061.99 89.64 3.02% 0.53%

WORLD MARKET PERFORMANCE

Source: Bloomberg; Index % change is based on price.

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5/18 6/1 6/15 6/29 7/13 7/27 8/10

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Dow Jones Industrial Average -Trailing 90 Days

Source: Bloomberg

320

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5/18 6/1 6/15 6/29 7/13 7/27 8/10

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Euro Stoxx Index-Trailing 90 Days

Source: Bloomberg



6

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5/18 6/1 6/15 6/29 7/13 7/27 8/10

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Brazil (Bovespa Index)-Trailing 90 Days

Source: Bloomberg

0

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India (Sensex Index)-Trailing 90 Days

Source: Bloomberg

850

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1,000

1,050

1,100

5/17 5/31 6/14 6/28 7/12 7/26 8/9

Inde

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Egypt (Hermes Index)-Trailing 90 Days

Source: Bloomberg

2,300

2,350

2,400

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2,500

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2,650

2,700

2,750

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2,850

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

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Singapore (Straits Times Index)-Trailing 90 Days

Source: Bloomberg

Equities – Emerging and Frontier Markets

Last Change % Chg. YTD % Last Change % Chg. YTD %Mexico IPC 38,949.88 897.13 2.4% -10.7% Hang Seng Index 25,183.01 651.39 2.7% -10.7%Brazil (Bovespa Index) 101,353.40 -1422.00 -1.4% -12.4% India (Sensex 30) 37,877.34 0.00 0.0% -8.2%MOEX Index (Russia) 3,061.99 89.64 3.0% 0.5% Malaysia (KLCI Index) 1,564.59 -13.55 -0.9% -1.5%Czech Republic (Prague) 913.06 5.80 0.6% -18.2% Singapore (Straits Times Index) 2,581.32 22.22 0.9% -19.9%Turkey (Istanbul) 1,083.83 23.24 2.2% -5.3% Thailand (SET Index) 1,327.05 -6.17 -0.5% -16.0%Egypt (Hermes Index) 1,069.37 21.49 2.1% -16.6% Indonesia (Jakarta) 5,247.69 103.80 2.0% -16.7%Kenya (Nairobi 20 Index) 1,743.58 -14.50 -0.8% -34.3% Pakistan (Karachi KSE 100) 40,290.74 261.05 0.7% -1.1%Saudi Arabia (TASI Index) 7,704.25 204.28 2.7% -8.2% Vietnam (Ho Chi Minh) 850.74 9.28 1.1% -11.5%Lebanon (Beirut BLOM Index) 601.09 -4.11 -0.7% -23.5% Sri Lanka (Colombo) 5,261.99 85.51 1.7% -14.1%Palestine 458.38 -0.40 -0.1% -12.8% Cambodia (Laos) 578.08 -9.63 -1.6% -20.6%

EMERGING AND FRONTIER MARKET PERFORMANCE




YIELD CURVES

7

Last Change % Chg. YTD % Last Change % Chg. YTD %2-Yr. U.S. Treasury 0.15% 0 bps NM NM Prime Rate 3.25% 0.00 NM NM5-Yr. U.S. Treasury 0.30% 7 bps NM NM Fed Funds Rate 0.25% 0.00 NM NM10-Yr. U.S. Treasury 0.71% 15 bps NM NM Discount Rate 0.25% 0.00 NM NM30-Yr. U.S. Treasury 1.44% 21 bps NM NM LIBOR (3 Mo.) 0.28% 3 bps NM NMGerman 10-Yr. Govt. -0.42% -9 bps NM NM Bond Buyer 40 Muni 2.19% 1 bps NM NMFrance 10-Yr. -0.13% -9 bps NM NM Bond Buyer 40 G.O. 2.05% NA NM NMItaly 10-Yr. 0.99% -6 bps NM NM Bond Buyer 40 Rev. 2.47% NA NM NMFed 5-Yr Fwd BE Inf. 1.55% 4 bps NM NM

SELECTED INTEREST RATES

Source: Bloomberg

1M 1Y 3Y 5Y 8Y 10Y 15Y 20Y 30Y0.00

1.00

2.00

3.00

4.00

5.00

6.00

US Treasury Actives Curve 20200807US Treasury Actives Curve 20200814USD Composite (A) BFV Curve 20200815USD Composite (BBB) BFV Curve 20200815

1.00

1.50

2.00

2.50

3.00

3.50

2/17 3/17 4/17 5/17 6/17 7/17

Inde

x

BBB/Baa- 10-Yr Treas. Spread Rising Line = Risk Aversion

Source: Bloomberg

Source: Bloomberg

Interest Rates

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2/18 3/18 4/18 5/18 6/18 7/18

Yiel

d %

10-Year Treasury Yield - Trailing 180 Days

Source: Bloomberg



8

86

88

90

92

94

96

98

100

102

104

2/17 3/17 4/17 5/17 6/17 7/17

U.S. Dollar Index - Trailing Six Months

Source: Bloomberg

0.80

0.85

0.90

0.95

1.00

1.05

1.10

1.15

1.20

1.25

2/17 3/17 4/17 5/17 6/17 7/17

Euro - U.S. Dollars per Euro

Source: Bloomberg

96.00

98.00

100.00

102.00

104.00

106.00

108.00

110.00

112.00

114.00

2/17 3/17 4/17 5/17 6/17 7/17

Japanese yen - Yen per U.S. Dollar

Source: Bloomberg

Last Change % Chg. YTD % Last Change % Chg. YTD %Dollar Index 93.10 -0.323 -0.35% -3.40% Chinese Yuan 6.95 -0.018 0.25% 0.19%Euro 1.18 0.005 0.43% 5.57% Swiss Franc 0.91 -0.003 0.34% 6.30%Japanese Yen 106.59 0.690 -0.65% 1.88% New Zealand Dollar 0.65 -0.006 -0.92% -2.91%British Pound 1.31 0.004 0.27% -1.28% Brazilian Real 5.42 -0.007 0.14% -25.79%Canadian Dollar 1.33 -0.012 0.92% -2.05% Mexican Peso 21.95 -0.412 1.87% -13.83%

SELECTED CURRENCY PERFORMANCE

Source: Bloomberg

6.80

6.85

6.90

6.95

7.00

7.05

7.10

7.15

7.20

2/17 3/17 4/17 5/17 6/17 7/17

Chinese yuan - yuan per U.S. Dollar

Source: Bloomberg

Currencies



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50

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2/18 3/18 4/18 5/18 6/18 7/18

$ pe

r bar

rel

Crude Oil - Light Crude ($ per barrel)

Source: Bloomberg

0

500

1,000

1,500

2,000

2,500

2/17 3/17 4/17 5/17 6/17 7/17

$ pe

r oun

ce

Gold - Spot gold price ($ per ounce)

Source: Bloomberg

Last Change % Chg. YTD % Last Change % Chg. YTD %Bloomberg Comm. Idx. 70.81 0.36 0.51% -12.46% Platinum Spot $945.38 -$17.96 -1.86% -1.85%Crude Oil $42.22 $0.94 2.28% -27.02% Corn 337.75 17.00 5.30% -16.09%Natural Gas $2.34 $0.11 4.78% 1.47% Wheat 509.50 6.00 1.19% -11.81%Gasoline ($/Gal.) $2.18 $0.00 -0.05% -15.75% Soybeans 898.00 30.50 3.52% -8.25%Heating Oil 124.20 2.19 1.80% -36.57% Sugar 13.10 0.43 3.39% -5.62%Gold Spot $1,944.65 -$90.35 -4.44% 28.20% Orange Juice 122.45 4.85 4.12% 10.12%Silver Spot $26.42 -$1.80 -6.35% 48.46% Aluminum 1,763.50 -7.50 -0.42% -2.57%Source: Bloomberg; % change is based on price. Copper 6,256.00 -52.00 -0.82% 1.33%

SELECTED COMMODITY MARKET PERFORMANCE

Commodities

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1,000

2,000

3,000

4,000

5,000

6,000

7,000

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Inde

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Copper

Source: Bloomberg

0

50

100

150

200

250

300

350

400

450

2/18 3/18 4/18 5/18 6/18 7/18

$ pe

r bus

hel

Corn - Active Contract

Source: Bloomberg



10

1,210

1,220

1,230

1,240

1,250

1,260

1,270

1,280

1,290

1,300

1,310

1,320

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

x

HFRX Global Hedge Fund Index - Trailing 90 Days

Source: Bloomberg

830

840

850

860

870

880

890

900

910

920

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

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HFRX Equity Market Neutral - Trailing 90 Days

Source: Bloomberg

1,485

1,490

1,495

1,500

1,505

1,510

1,515

1,520

1,525

1,530

1,535

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

x

IQ Fixed Income Beta Arb Index - Trailing 90 Days

Source: Bloomberg

1,100

1,120

1,140

1,160

1,180

1,200

1,220

1,240

5/18 6/1 6/15 6/29 7/13 7/27 8/10

Inde

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HFRX Equity Hedge Index - Trailing 90 Days

Source: Bloomberg

Last Change % Chg. YTD % Last Change % Chg. YTD %HFRX Global Hedge Fund Index 1304.55 -1.15 -0.09% 0.94% HFRX Special Situation Index 1355.52 -3.55 -0.26% 3.44%HFRX Equity Market Neutral 905.23 11.00 1.23% -5.16% HFRX Merger Arbitrage Index 1803.80 -0.24 -0.01% -0.99%HFRX Equity Hedge Index 1218.93 2.21 0.18% -4.35% HFRX Convertible Arbitrage Index 891.54 4.45 0.50% 7.27%HFRX Event-Driven Index 1668.56 -4.11 -0.25% 3.14% HFRX Macro CTA Index 1192.26 -8.60 -0.72% 0.99%HFRX Absolute Return Index 1102.96 -2.05 -0.19% -0.12% IQ Fixed Income Beta Arb Index 1528.29 2.40 0.16% -1.38%

SELECTED ALTERNATIVE INVESTMENT INDEX PERFORMANCE


Alternative Investments



4.40

4.50

4.60

4.70

4.80

4.90

5.00

5.10

5.20

5.30

5.40

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

S&P 500/MSCI EAFE - Trailing 180 Days

Source: Bloomberg

1.30

1.35

1.40

1.45

1.50

1.55

1.60

1.65

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

MSCI EAFE/MSCI EM - Trailing 180 Days

Source: Bloomberg

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

2/18 3/18 4/18 5/18 6/18 7/18

Inde

xLarge Cap/Small Cap - Trailing 180 Days

Source: Bloomberg

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

Growth/Value - Trailing 180 Days

Source: Bloomberg

August 17, 2020

11

3.00

4.00

5.00

6.00

7.00

8.00

9.00

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

S&P 500/MSCI EM - Trailing 180 Days

Source: Bloomberg

Portfolio Construction



0.680

0.700

0.720

0.740

0.760

0.780

0.800

0.820

0.840

0.860

2/18 3/18 4/18 5/18 6/18 7/18

Inde

xHigh Yield/Inv. Grade Bonds - Trailing 180 Days

Source: Bloomberg

0.260

0.270

0.280

0.290

0.300

0.310

0.320

0.330

0.340

0.350

2/18 3/18 4/18 5/18 6/18 7/18

Inde

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Info Tech/S&P 500 - Trailing 180 Days

Source: Bloomberg

0.00

0.50

1.00

1.50

2.00

2.50

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

Inv. Grade Bonds/Int. Govt. Bonds - Trailing 180 Days

Source: Bloomberg

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

1.60

1.80

2/18 3/18 4/18 5/18 6/18 7/18

Inde

x

High Yield Bonds/Int. Govt. Bonds - Trailing 180 Days

Source: Bloomberg

August 17, 2020

12

Portfolio Construction (continued)



13

August 17, 2020

The Relative Strength Matrix provides an indication of how the various asset classes have performed relative to one another over the past 30 days. A number greater than 1.0 indicates that the asset class in the far left column has outperformed the corresponding asset class in the top row over the past 30 days. A number below 1.0 means the asset class on the left has underperformed the asset class at the top. The green shading indicates outperformance, and the red shading indicates underperformance.

Source: Bloomberg

Large Cap Core

Large Cap Growth

Large Cap Value

Mid Cap Core

Mid Cap Growth

Mid Cap Value

Small Cap Core

Small Cap Growth

Small Cap Value

Int'l . Developed

Emerging Markets REITs Comm. Int. Bond High Yield

Large Cap Core 1.00 0.99 1.09 1.02 1.04 1.05 1.02 1.01 1.05 1.02 1.01 1.17 0.97 1.23 1.13Large Cap Growth 1.01 1.00 1.10 1.03 1.05 1.06 1.03 1.02 1.06 1.03 1.02 1.18 0.98 1.24 1.14Large Cap Value 0.92 0.91 1.00 0.94 0.96 0.97 0.94 0.93 0.97 0.93 0.92 1.07 0.89 1.13 1.04Mid Cap Core 0.98 0.97 1.07 1.00 1.02 1.03 1.00 0.99 1.03 1.00 0.99 1.14 0.95 1.21 1.11Mid Cap Growth 0.96 0.95 1.04 0.98 1.00 1.01 0.98 0.97 1.01 0.98 0.96 1.12 0.93 1.18 1.08Mid Cap Value 0.95 0.94 1.04 0.97 0.99 1.00 0.97 0.96 1.00 0.97 0.96 1.11 0.92 1.17 1.07Small Cap Core 0.98 0.97 1.07 1.00 1.02 1.03 1.00 0.99 1.03 1.00 0.98 1.14 0.95 1.20 1.11Small Cap Growth 0.99 0.98 1.08 1.01 1.03 1.04 1.01 1.00 1.04 1.01 1.00 1.15 0.96 1.22 1.12Small Cap Value 0.95 0.94 1.03 0.97 0.99 1.00 0.97 0.96 1.00 0.97 0.95 1.11 0.92 1.17 1.07Int'l . Developed 0.98 0.97 1.07 1.00 1.02 1.03 1.00 0.99 1.03 1.00 0.99 1.14 0.95 1.21 1.11Emerging Markets 0.99 0.98 1.08 1.01 1.04 1.05 1.02 1.00 1.05 1.01 1.00 1.16 0.96 1.22 1.12REITs 0.86 0.85 0.94 0.88 0.90 0.90 0.88 0.87 0.90 0.87 0.86 1.00 0.83 1.06 0.97Commodities 1.03 1.02 1.12 1.05 1.08 1.08 1.05 1.04 1.09 1.05 1.04 1.20 1.00 1.27 1.17Int. Bond 0.81 0.81 0.89 0.83 0.85 0.86 0.83 0.82 0.86 0.83 0.82 0.95 0.79 1.00 0.92High Yield 0.88 0.87 0.96 0.90 0.92 0.93 0.90 0.89 0.93 0.90 0.89 1.03 0.86 1.09 1.00

RELATIVE STRENGTH MATRIX (BASED ON 30-DAY RSI)

5/28 6/4 6/11 6/18 6/25 7/2 7/9 7/16 7/23 7/30 8/6 8/13

Large Cap (R200) 2.34% 2.39% -3.01% 3.75% -0.61% 1.55% 1.39% 1.39% 0.42% 0.35% 3.59% 0.49%

Small Cap (R2000) 3.94% 3.67% -6.60% 5.22% -0.96% 1.31% -2.30% 4.91% 1.54% 0.33% 3.31% 2.28%

MSCI EAFE 5.23% 4.43% -1.71% 0.68% -1.15% 1.51% -0.11% 2.60% 1.23% -1.57% 0.89% 2.71%

MSCI Em. Mkts. -0.50% 6.86% 0.48% 0.16% 0.93% 1.90% 5.49% -3.13% 3.03% 0.41% 2.27% -0.94%

BarCap Agg. (AGG) -0.03% -0.43% 0.54% 0.26% 0.09% 0.27% 0.37% 0.11% 0.47% 0.16% 0.05% -1.05%

High Yield (JNK) 1.55% 2.00% -2.20% 1.91% -1.26% -0.17% 0.09% 1.48% 1.51% 1.02% 0.07% -1.31%

Bloomberg Commodity

Index-0.39% 2.52% -0.40% 0.04% -1.05% 3.44% 1.09% 0.19% 2.48% 0.19% 4.52% -0.70%

Hedge Funds (HFRX Global) 0.73% 0.76% 0.15% 0.60% 0.36% 0.14% 0.45% 0.16% 0.60% -0.16% 0.89% -0.15%

60/40* 1.92% 2.04% -1.72% 1.94% -0.44% 1.00% 0.58% 1.25% 0.86% 0.03% 1.67% 0.30%

48/32/20 (w/Alts.)** 1.68% 1.78% -1.34% 1.67% -0.28% 0.83% 0.55% 1.03% 0.81% -0.01% 1.52% 0.21%

Source: Bloomberg; *60/40 portfolio = 30% Large Cap/10% Small Cap/15% EAFE/5% Emerging Markets/35% BarCap Agg./5% High Yield.**48/32/20 portfolio = 24% Large Cap/8% Small Cap/12% EAFE/4% Emerging Markets/28% BarCap Agg./4% High Yield/20% HFRX Global Index.

WEEKLY ASSET CLASS PERFORMANCE (Prior 12 weeks ending Thursday)

Alternatives

Asset Allocation

Domestic Equity

Int'l. Equity

Fixed Income

Commodities

Equity



14

Index Overview & Key DefinitionsFed, The Fed or FED refers to the Federal Reserve System, the central ba nk of the United Sta tes. The Federal O pen Market Committee (FOMC) is the moneta ry policymaking body ofthe Federal Reserve System. Fed Funds Rate, the interest ra te at which a depository institution lends funds ma intained at the Federal Reserve to another depository institutionovernight. The European Central Bank (ECB) is the central ba nk for Europe's single currency, the euro. The ECB’s ma in task is to mainta in the euro's purchasing power and thus pricestability in the euro area. The euro a rea comprises the 19 Europea n Union countries tha t have introduced the euro since 1999. The Gross Domestic Pr oduct (GDP) ra te is ameasurement of the output of goods a nd services produced by la bor a nd property located in the United Sta tes. Basis Point(s) is a unit tha t is equa l to 1/ 100th of 1%, a nd is used todenote the change in a fina ncial instrument. The bas is point is commonly used for calcula ting cha nges in interest rates, equity indexes a nd the yield of a fixed-income security. Aseparately managed account (SMA) is an individual ma naged investment account offered typically by a brokerage firm throug h one of their brokers or f ina ncia l consultants a ndmanaged by independent investment management firms (often called money ma nagers for short) and have va rying fee structures. The Consumer Price Index (CPI) measures thechange in the cost of a fixed basket of products and services. The Producer Price Index (PPI) prog ram measures the average change over time in the selling prices received bydomestic producers for their output. The prices included in the PPI a re from the first commercia l tra nsaction for ma ny products a nd some services. Core CPI is a n additional CPIIndex, excludes energy and food item price cha nges, and measures the “core” or “underlying ” rate of inflation. The PCE (Persona l Consumption Expenditure) Index of Prices is a US--wide indica tor of the average increase in prices for a ll domestic personal consumption. Using a variety of data including U.S. Consumer Price Index and Producer Price Index prices, itis derived from personal consumption expenditures; essentially a measure of goods and services ta rgeted towa rds individua ls and consumed by individuals. The PurchasingManagers' Index (PMI) is a n indica tor of the economic health of the manufacturing sector. The PMI is based on five major indicators: new orders, inventory levels, production,supplier deliveries a nd the employment environment. Brexit is a commonly used term for the United Kingdom's withdra wal from the European Union. The Kansas City FedManufacturing S urvey monitors manufacturing plants se lected according to geogra phic dis tribution, industry mix and s ize in the Tenth Federa l Reserve Dis trict. West TexasIntermediate (WTI), a lso known as Texas light sweet, is a g rade of crude oil used as a benchma rk in oil pricing. R isk Premium is the return in excess of the risk-free ra te of return aninvestment is expected to yield. LIBOR or ICE LIBOR (previously BBA LIBO R) is a benchmark ra te, which some of the world’s lea ding banks cha rge each other for short-term loa ns. Itstands for Intercontinental Exchange London Interbank Offered Rate and serves as the first step to calculating interest rates on various loans throughout the world.

The Dow Jones I ndustr ial Average (DOW or DJIA) is a n unmanaged index of 30 common stocks comprised of 30 actively tra ded blue chip stocks, primarily industrials a nd assumesreinvestment of dividends. The S&P 500 Index is a n unma naged index comprised of 500 widely held securities considered to be representative of the stock ma rket in general. TheS&P/Case-S hiller Home Price Indices measure the residential housing ma rket, tracking cha nges in the value of the residentia l rea l esta te ma rket in 20 metropolita n regions acrossthe United Sta tes. The Nasdaq Composite I ndex is a stock ma rket index of the common stocks and simila r securities listed on the NASDAQ stock market. The US Dollar Index is ameasure of the value of the United S tates dolla r relative to a basket of foreig n currencies. It is a weighted geometric mean of the dollar's value relative to other select currencies(Euro, Ja panese yen, Pound sterling, Ca nadian dolla r, S wedish krona (SEK) & Swiss fra nc). The FTSE 100 Index (FTSE 100) is a sha re index of the 100 companies listed on the LondonStock Exchange (LSE) with the highest ma rket ca pitaliza tion. The Bloomberg Commodity Index (formerly the Dow Jones-UBS Commodity I ndex) tracks prices of futures contracts onphysica l commodities on the commodity ma rkets a nd is des igned to minimize concentration in any one commodity or sector (currently 22 commodity futures in seven sectors). TheBarclays Capital US Credit Index is an unma naged index considered representa tive of publicly issued, SEC-regis tered US corporate and specified fore ign debentures a nd securednotes. The Barclays Capita l US Aggregate Bond Index is a market capitalization-weighted index of investment-gra de, fixed-rate debt issues, including government, corpora te, asset-backed, a nd mortgage-backed securities, with maturities of a t least one yea r. The Barclays Capita l US Corporate High Yield Index covers the USD-denominated, non-investmentgrade, f ixed-rate, taxa ble corporate bond ma rket. Securities are class ified as hig h-yield if the middle rating of Moody’s, Fitch a nd S&P is Ba1/ BB+/ BB+ or below. The index mayinclude emerging ma rket debt. The Barclays Capita l Municipal Bond Index is an unma naged index comprised of investment-gra de, f ixed-rate municipal securities representa tive ofthe ta x-exempt bond ma rket in general. The Barclays Capital US Treasury Tota l Return Index is a n unma naged index of public obligations of the US Treasury with a remainingmaturity of one year or more. The Barclays Capita l Global Aggregate ex-U.S. Index is a ma rket capitalization-weighted index, mea ning the securities in the index a re weightedaccording to the market size of ea ch bond type. Most U.S. traded investment gra de bonds a re represented. Municipal bonds, a nd Treasury Inf lation-Protected Securities a reexcluded, due to tax trea tment issues. The index includes Treasury securities, Government agency bonds, M ortgage-ba cked bonds, Corporate bonds, a nd a small amount of fore ignbonds tra ded in U.S. The Barclay s Capita l U.S. 5-10 Year Corporate B ond Index measures the investment return of U.S. dolla r denominated, investment-gra de, fixed rate, taxa blesecurities issued by industrial, utility, and fina ncial companies with ma turities between 5 a nd 10 yea rs. Treasury securities, mortgage-backed securities (M BS) foreign bonds,government agency bonds and corpora te bonds a re some of the categ ories included in the index. The Barclays Capital U.S Cor porate Hig h-Yield Index is composed of f ixed-rate,publicly issued, non-investment gra de debt. The Barclay s Capital U.S. Corporate 5-10 Year Index includes U.S. dolla r-denomina ted, investment-gra de, fixed-rate, taxa ble securitiesissued by industrial, utility, & financial companies, with maturities between 5 & 10 years. The Russell 1000 Index is a ma rket ca pitalization-weighted benchma rk index made up ofthe 1000 largest U.S. compa nies in the Russell 3000 Index. The R ussell 1000 Growth Index is an unmanaged index considered representa tive of large-cap growth stocks. The R ussell1000 Value Index is an unma naged index cons idered representative of la rge-ca p value stocks. The Russell 2000 Index is a n unmanaged index considered representative of sma ll-capstocks. The R ussell 2000 Gr owth I ndex is an unma naged index considered representa tive of small-ca p g rowth stocks. The Russell 2000 Growth Index is a n unmanaged indexcons idered representa tive of small-cap value stocks. The R ussell 3000 I ndex is a n unmanaged index considered representative of the US stock ma rket. The R ussell Midcap I ndex is asubset of the Russell 1000 I ndex. It includes approxima tely 800 of the smallest securities based on a combina tion of their ma rket ca p and current index membership. The R ussellMidcap Growth Index is a n unmanaged index cons idered representative of mid-cap g rowth stocks. The Russell M idcap Value Index is an unmanaged index consideredrepresenta tive of mid-ca p value stocks. The HFRX Indices a re a series of benchmarks of hedge fund industry performance which are engineered to achieve representa tiveperformance of a la rger universe of hedge fund stra tegies. Hedge F und Resea rch, Inc. employs the HF RX Methodology (UCITS complia nt), a proprieta ry a nd highly quantita tiveprocess by which hedge funds a re selected as constituents for the HFRX Indices. The U nivers ity of Michigan Consumer Sentiment Index (MCSI) is a survey of consumer confidenceconducted by the University of Michigan us ing te lephone surveys to gather informa tion on consumer expecta tions regarding the overall economy. The CBOE Volatility Index (VIX) isan up-to-the-minute market estima te of expected v olatility that is calcula ted by using real-time S&P 500 Index option bid/ask quotes. The I ndex uses nearby and second nea rbyoptions with at least 8 days left to expira tion a nd then weights them to yield a consta nt, 30-day measure of the expected vola tility of the S&P 500 Index. The MSCI EAFE Index isdesigned to measure the equity ma rket performa nce of developed ma rkets outside of the U.S. & Ca nada. The MSCI EAFE Gr owth Index is a n unma naged index consideredrepresenta tive of growth stocks of Europe, A ustralas ia and the Far East. The MSCI EAFE Value Index is a n unmanaged index cons idered representa tive of value stocks of Europe,Australasia and the Fa r East. The MSCI EM (Emerging Markets) Latin America Index is a free f loa t-adjusted ma rket ca pitalization weighted index tha t is des igned to measure theequity ma rket performa nce of emerging markets in La tin America. The MSCI World ex-U.S. Index ca ptures la rge and mid-cap representation across 22 of 23 Developed Ma rkets(DM) countries - excluding the US. With 1,002 constituents, the index covers approxima tely 85% of the free float-a djusted market ca pita liza tion in ea ch country. The MSCI JapanIndex is designed to measure the performance of the la rge and mid-ca p segments of the Ja panese market. With 320 constituents, the index covers a pproximately 85% of the freefloat-adjusted ma rket ca pitalization in Ja pan. The MSCI Emerging Markets Index is a free f loa t-adjusted market capitalization index tha t is desig ned to measure equity ma rketperformance in the global emerging ma rkets. The MSCI Europe I ndex is an unmanaged index cons idered representative of stocks of developed European countries. The MSCIPacific Index is a free floa t-a djusted market ca pitalization weighted index tha t is desig ned to measure the equity market performa nce of the developed markets in the Pacif ic region.The Barclays Intermediate US Government/Credit Bond I ndex is a ma rket capita liza tion-weighted index of investment-gra de, fixed-ra te debt issues, including Treasuries,government-rela ted a nd U.S. corporate securities, with ma turities of a t least one yea r and less tha n 10 years. The NY Empire S tate Manufacturing Index is based on the monthlysurvey of ma nufacturers in New York Sta te – known as the Empire Sta te Ma nufa cturing S urvey – conducted by the Federa l Reserve Bank of New York. The S&P The Dow JonesWilshire U.S. REIT Index tra cks the performa nce of publicly traded REITs and REIT-like securities a nd is desig ned to serve as a proxy for direct real estate investment, in pa rt byexcluding compa nies whose performa nce may be driven by fa ctors other tha n the value of real esta te. The Russell Top 200 I ndex measures the performa nce of the 200 la rgestcompanies in the Russell 1000 Index, with a weig hted average ma rket ca pita liza tion of $186 billion. The Barclays 1-3 Year US Treasury Bond Index measures public US Treasuryobligations with rema ining maturities of one to three yea rs. The S&P LSTA Leveraged Loan I ndex is an unma naged capita liza tion-weighted syndica ted loa n index based upon ma rketweightings, spreads a nd interest payments. It covers the US market ba ck to 1997 and currently calcula tes on a daily basis. The NFIB Small Business Optimism Index is compiledfrom a surveythat is conducted each monthby the National Federation of Independent Business (NFIB) of its members



15

The information, analysis, and opinions expressed herein are for general and educational purposes only. Nothing contained in this weeklyreview is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of anyinvestment, nor a solicitation of any type. All investments carry a certain risk, and there is no assurance that an investment will providepositive performance over any period of time. An investor may experience loss of principal. Investment decisions should always be madebased on the investor’s specific financial needs and objectives, goals, time horizon, and risk tolerance. The asset classes and/or investmentstrategies described may not be suitable for all investors and investors should consult with an investment advisor to determine theappropriate investment strategy. Past performance is not indicative of future results.

Information obtained from third party sources are believed to be reliable but not guaranteed. Envestnet|PMC™ makes no representationregarding the accuracy or completeness of information provided herein. All opinions and views constitute our judgments as of the date ofwriting and are subject to change at any time without notice.

Investments in smaller companies carry greater risk than is customarily associated with larger companies for various reasons such as volatilityof earnings and prospects, higher failure rates, and limited markets, product lines or financial resources. Investing overseas involves specialrisks, including the volatility of currency exchange rates and, in some cases, limited geographic focus, political and economic instability, andrelatively illiquid markets. Income (bond) securities are subject to interest rate risk, which is the risk that debt securities in a portfolio willdecline in value because of increases in market interest rates.

Exchange Traded Funds (ETFs) are subject to risks similar to those of stocks, such as market risk. Investing in ETFs may bear indirect fees andexpenses charged by ETFs in addition to its direct fees and expenses, as well as indirectly bearing the principal risks of those ETFs. ETFs maytrade at a discount to their net asset value and are subject to the market fluctuations of their underlying investments. Investing incommodities can be volatile and can suffer from periods of prolonged decline in value and may not be suitable for all investors.

Index Performance is presented for illustrative purposes only and does not represent the performance of any specific investment product orportfolio. An investment cannot be made directly into an index.

Alternative Investments may have complex terms and features that are not easily understood and are not suitable for all investors. Youshould conduct your own due diligence to ensure you understand the features of the product before investing. Alternative investmentstrategies may employ a variety of hedging techniques and non-traditional instruments such as inverse and leveraged products. Certainhedging techniques include matched combinations that neutralize or offset individual risks such as merger arbitrage, long/short equity,convertible bond arbitrage and fixed-income arbitrage. Leveraged products are those that employ financial derivatives and debt to try toachieve a multiple (for example two or three times) of the return or inverse return of a stated index or benchmark over the course of a singleday. Inverse products utilize short selling, derivatives trading, and other leveraged investment techniques, such as futures trading to achievetheir objectives, mainly to track the inverse of their benchmarks. As with all investments, there is no assurance that any investment strategieswill achieve their objectives or protect against losses.

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August 17, 2020 · 8/17/2020 · PMC Weekly Market Brief 3 August 17, 2020 0 500 1000 1500 2000...

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