Summary

• Equities rose 2.65% in the fourth quarter, finishing the year on an eight-month run of positive returns.
• Within the Index, Health Care and Information Technology stocks had the strongest returns for the quarter, followed by Communication Services.
• Looking forward, we expect the equity market to remain highly sensitive to policy signals and earnings delivery as valuations hover near historically elevated levels.

Investment Environment

Equities rose 2.65% (S&P 500 Total Return – USD) in the fourth quarter, finishing the year on an eight-month run of positive returns. It was a strong end to the year, which saw equities rise 17.9%, including an -18.8% peak-to-trough fall of -18.8% between February