The following is your May 2024 Robertson Stephens Monthly Performance Report.
May was a good month for returns from both stocks and bonds, and if you look at the chart below, it was, for many indices, the mirror image of April’s all-asset correction. At the margin, technology outperformed its April losses in May. Note tech’s positive return influence in the S&P 500 (cap weighted vs equal weighted) and NASDAQ while small caps and bonds underperformed by comparison. That has been a consistent market theme for over a year.
Going into the summer, the read on the economy, inflation, bond yields, stock prices, the Fed, and even non-metal commodities all feel like they are in a state of suspended animation. Economic data has tempered concerns of overheating lately until a much hotter-than-expected May employment report on 6/7 read not-so-fast. Same story for inflation. It looks like it is leaning lower, and price pressures in services sectors start looking very sticky. Economists are questioning the restrictive nature of the Fed’s current stance, and with all the data flip-flopping, it may be a valid question.
In summary, it is possible, with all the back and forth in data and opinion, that the next two months might be a lot like the past two months – a seesaw with little progress in either direction. Maybe better than nothing for tech and less for small-cap and bonds.
Be well,
Mike
Sources: Addepar, BCA Research, Bloomberg, and Ned Davis Research
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