Gateway Financial Partners



October 2023 | Monthly Economic Update

Source: FactSet

September is historically a challenging month for the stock market, and this year proved no different. Global markets were led lower by rising interest rates and oil prices. US equities continued their August decline, falling 4.8% for the month. International equities fared better than domestic but still posted negative returns.

Within S&P 500 sectors, energy was the sole standout, with 2.6% positive returns helped by supply cuts, which led crude oil prices to their highest levels in more than a year. Interest rate-sensitive sectors of real estate and technology struggled most as bond yields rose. Large-sized companies outperformed the more risk-sensitive small caps, and results were mixed between growth and value styles depending on market capitalization.

The benchmark 10-year Treasury yield ended September at 4.57%, levels not seen since before the great financial crisis of 2008. Surging bond yields led bond prices lower, and US bonds fell 2.5%. Bonds with less interest rate sensitivity, such as short-term US treasuries and high-yield bonds, fared better for the quarter.

Surging oil prices alone were not adequate to hold up the broad commodity index, which declined 0.7%. Precious metals, including gold, fell 4.7% despite a volatile month, detracted from the commodities index as they saw weakness in response to a stronger US dollar. Real estate was among the worst performers for September as it faced pressure from rising rates and cooling economic activity.

With little positive performance across asset classes, balanced portfolios struggled again, with the global 60/40 index blend down 3.6% in September. Broad fixed income and commodities helped relative to the 60/40, while equities, real estate, and gold detracted from returns relative to a balanced portfolio.

Source: FactSet

The Monthly Riddle

What word can be added before or after these words to make a new word or phrase?

Break, Light, May

LAST MONTH’S RIDDLE: What has two banks but no money?

ANSWER:  River

Tip of The Month

Closely monitoring your expenses is crucial for optimizing profitability; it provides valuable insights into cost-saving opportunities and helps mitigate financial risks.

Important Information
This is for informational purposes only, is not a solicitation, and should not be considered investment, legal or tax advice. The information has been drawn from sources believed to be reliable, but its accuracy is not guaranteed, and is subject to change. Investors seeking more information should contact their financial advisor. Financial advisors may seek more information by contacting AssetMark at 800-664-5345.

Investing involves risk, including the possible loss of principal. Past performance does not guarantee future results. Asset allocation cannot eliminate the risk of fluctuating prices and uncertain returns. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio. No investment strategy, such as asset allocation, can guarantee a profit or protect against loss. Actual client results will vary based on investment selection, timing, market conditions, and tax situation.

It is not possible to invest directly in an index. Indexes are unmanaged, do not incur management fees, costs and expenses and cannot be invested in directly. Index performance assumes the reinvestment of dividends.

Investments in equities, bonds, options, and other securities, whether held individually or through mutual funds and exchange traded funds, can decline significantly in response to adverse market conditions, company-specific events, changes in exchange rates, and domestic, international, economic, and political developments.

Bloomberg® and the referenced Bloomberg Index are service marks of Bloomberg Finance L.P. and its affiliates, (collectively, “Bloomberg”) and are used under license. Bloomberg does not approve or endorse this material, nor guarantees the accuracy or completeness of any information herein. Bloomberg and AssetMark, Inc. are separate and unaffiliated companies.

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