Stay Defensive. Bull Markets Don’t Start with the S&P 500 Trading at 18x Earnings

Despite Volatility, Markets Post Gains in Q1.

Despite bank failures and uncertainty regarding monetary policy and interest rates, equities posted gains in Q1 as the Nasdaq 100 Index was up nearly 17%, notching its best quarter since the second quarter of 2020. US growth stocks were among the best performers (+9.6%), followed by international developed equities (+8.5%) and US large-caps (+7.5%). Bonds also fared well as investment grade corporates rose 4.7%, 7-10 year US Treasuries increased 3.9%, and high yield credits gained 3.7%. Commodities produced mixed returns as both gold and silver were up (+8.0% and +0.5%, respectively), while broad-based commodities and crude oil fell (-5.9% and -5.2%, respectively)