Despite March’s Bounce Back, Q1 2022 Ends as Worst Since 2020

Worst Since 2020

After a strong start, stocks trimmed gains throughout the week and ended slightly positive. We saw global markets (represented by the MSCI All Country World Index) up 0.5% and domestic stocks (represented by the S&P 500 Index) up 0.1%.

Despite being the worst quarter for stocks since 2020, most equity markets rebounded for a positive month of March. For the first quarter, global markets (represented by the MSCI All Country World Index) were down -5.4%, and domestic stocks (represented by the S&P 500 Index) were down -4.6%.

Unemployment Rate

More positive economic data was released last week with another strong jobs report leading the way. For the month of March, unemployment dropped to a 3.6% rate, which is the lowest since the pandemic started. Additionally, wage growth rose to 5.6%.

Oil Prices

After President Biden announced that the U.S. would release millions of barrels of oil from strategic reserves, oil prices dropped down below $100/barrel.

Corporate Earnings Expectations

Even in the face of high inflation and geopolitical turmoil, analysts have continued to raise corporate earnings expectations for 2022. For 2022, FactSet reported that analyst estimates for S&P 500 earnings growth have increased up to approximately 10%. There have been some adjustments, where the expectations for Q1 have dropped slightly while the remaining three quarters have risen.

Webinar April 5th

There is a lot to recap for Q1 and our outlook moving forward, so please join me tomorrow (4/5) for our quarterly webinar where I’ll do just that. Additionally, there will be a more detailed newsletter released later this week with content around the same topic.

I’d like to leave you with the final line we’ve used since we started these commentaries back at the very height of market volatility in March 2020. Always remember that we create financial/investment plans not for the easy times, but to prepare for the tough ones.

The views expressed in this commentary are subject to change and are not intended to be a recommendation or investment advice.  Such views do not take into account the individual financial circumstances or objectives of any investor that receives them.

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