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Quarter-End Insights

Our Take on the First Quarter

The stock rally continued into 2017 as President Donald Trump took office, and the Fed hiked rates.

Eight years into the bull market, stocks continued their climb in the first quarter of 2017. The broad-based US Market Index was up 5.9% in the quarter, is up almost 18% over the past 12 months and 7.6% on an annualized basis for the past 15 years. 

The dominant story in the U.S. at the start of the year was the beginning of the Trump administration. Investors continued to bet that changes to the tax code, rolling back of regulations, and an infrastructure spending program would boost business. The makeup of the rally in the fourth quarter and the first looks different as as more details about policies have emerged. The market has been re-evaluating would-be winners and losers. For example, in the fourth quarter small-cap stocks were the best performers and large-caps the worst, but that flipped in the first quarter partially because big changes to trade rules that would impact larger business appear to have become less likely.