Financial Market Commentary

Monthly Market Commentary

May 2023 Edition

These monthly market commentaries share a synopsis of the U.S. financial markets with intelligent insights.

Written May 3rd, 2023

Following an interesting Q1 that produced positive returns across equities and bonds, albeit with some large differences across style, size and sectors, April was a bit more subdued but overall, a positive month for most portfolios.  Investors were content to continue most of the trends of Q1 while waiting on the Fed’s next expected increase in rates in early May.  As the month end arrived, another bank was taken over by regulators though the move had largely been priced in and did not upend markets. 

Here are a few high-level comments on what occurred across the public investment markets during the month:


  • The S&P 500 was up 1.56% with a broader market participation than in prior months.
  • The Bloomberg Aggregate Bond Index was up 0.61% as volatility subsided across spread sectors.          

Domestic Equity 

  • Domestic equity markets delivered mixed returns as the lingering effects of the mini banking crisis weighed on small caps while larger caps generated small positive gains for the month. 
  • Larger cap Value stocks recovered modestly, aided by a boost in energy stocks.  Larger cap Growth added to their YTD gains with favorable performance across many sectors.

International and Global Equities 

  • Foreign developed equity markets sustained their rally to start 2023, boosted by strong results across much of Europe.
  • Emerging Market equity returns lagged developed markets, largely due to the 5% decline in Chinese stocks.  The elevated volatility in China has negatively impacted the broader index returns given the country's large index weight. 

Fixed Income Markets 

  • Bond market indices were positive during April, benefitting from stability across the sectors and less volatility in financials.  

Specialty Markets

  • REITs delivered small gains while commodities posted modest losses due to declines in many agricultural markets and the price of copper.

US Equity Sectors

  • Sector returns were generally positive with Communication Services and Consumer Staples leading while Industrials lagged. 


Dear Valued Investor,

Spring is often thought of as an uplifting time, marked by growth and renewed hope as we emerge from the long months of winter and look ahead to the rest of year. Investors saw signs of such renewed hope in recent weeks, especially on the inflation front as several inflation measures showed signs of improvement. We also saw markets stabilize after the surprisingly fast collapse of Silicon Valley Bank. But although it initially appeared that a stable spring would set the markets up for a calm, quiet summer, a flurry of recent activity is testing investor sentiment.

Another bank collapse also put investors a bit on edge last week as JPMorgan—with financial support from the FDIC—will acquire First Republic Bank, the second biggest bank to fail in U.S. history. The story was similar to Silicon Valley Bank, with a concentrated and wealthy deposit base and mismanaged bond portfolio. These unique characteristics and a government backstop make any other large bank failures unlikely in the near term, though sentiment around bank conditions is fragile.

In other significant news, Treasury Secretary Janet Yellen warned that the date when the U.S. might not be able to pay its bills is fast approaching, if the debt ceiling is not raised or suspended soon. With the time for debate shrinking, the Treasury encouraged Congress not to wait until the last minute to resolve the debt ceiling issue (as they did in 2011). This urgent warning may actually provide a silver lining for investors, however, if Congress is pushed to resolve the issue sooner and avoids a summer-long Congressional debate. Markets may stabilize once the debt ceiling issue is resolved and the Fed ends its current interest rate tightening campaign.

Looking ahead, we see several signs of health for the economy and markets, such as delinquency rates on consumer loans still below pre-COVID-19 levels. Although business hiring intentions have slowed and consumers are pulling back on spending, we do not see the types of cracks we observed in the years leading up to the Great Financial Crisis. We may not have a clear path for growth just yet, with some banks still under duress and the debt ceiling yet unresolved, but we believe the upward trajectory remains thanks to a relatively healthy consumer base.

Please reach out to us if you have any questions or would like a review of your investment accounts.


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Scott Krase
Wealth Manager
Connor & Gallagher OneSource (CGO)

Securities offered through LPL Financial, Member FINRA & SIPC.  Investment advisory services offered through Global Retirement Partners, LLC DBA Connor & Gallagher OneSource, an SEC registered investment advisor.  Connor & Gallagher OneSource and Connor & Gallagher Benefit Services are separate entities from LPL Financial.

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This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

All data is provided as of August 3, 2022.

All index data from FactSet.

The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. Connor & Gallagher OneSource doesn’t provide research on individual equities. All information is believed to be from reliable sources; however Connor & Gallagher OneSource makes no representation as to its completeness or accuracy.

Contact Scott With Any Questions or if You Would Like a Review of Your Portfolio


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