In this issue:

Economic and Market Overview

The Perfect Storm
The sobering start to 2022 saw pervasive weakness across multiple fronts during the first quarter: the economy, fixed income markets and equity markets.

Fixed Income Commentary

Still a Bumpy Road for Fixed Income
Core fixed income returns were negative in the second quarter, further exacerbating the largest drawdown on record.

• The Ice BofA US Master Index is down 4.6% in the second quarter
• The Ice BofA US Master Index is down 10.4% year-to-date
• Investment grade corporate bond spreads are much wider in second quarter
• Investment grade bonds underperformed Treasuries by about 4.5% this year

Improving Fundamental Case for Lower Yields

The technical backdrop on Treasuries is quite negative given they are in a clear downtrend regarding price.

Equity Commentary

Equity Markets Continue Their Descent
U.S. equities declined 16.7% for the second quarter, and 21.1% year-to-date. Foreign equities retreated 13.7% and are down 18.4% year-to-date.