Financial Market Commentary

Monthly Market Commentary

November 2023 Edition

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

November Investment and Economic Commentary

The major domestic and international equity indices have declined in each of the last three months, significantly cutting into the strong returns of the first half of 2023.  Most fixed income market segments have declined in the last three months.  In fact, the Bloomberg Aggregate Bond index has declined for six consecutive months.  One of the primary drivers of the negative performance for stocks and bonds is the steady rise in interest rates.  Since July 1, 2023, the US 10 YR Treasury yield has risen 1.05%, which is a 28% increase over the period.  This sharp rise has negatively impacted valuations on stocks and bonds, all the while the US economy has maintained strong growth and inflation has grinded lower.  It is a challenging environment for the Fed to navigate through. 

Here are a few observations about what occurred across the public markets during the month.


  • The S&P 500 was down -2.1% in October and -8.3% over the last three months.  YTD, the index is up 10.7%.
  • The Bloomberg Aggregate Bond Index was down -1.6% in October and -4.7% over the last three months.  YTD, the index is down -2.8%.

Domestic Equity 

  • Equity markets continued its negative streak in October as all styles and market caps in the US and Overseas generated negative returns for three straight months. Reasons for the negative returns can be attributed to mixed tech earnings, geopolitical tensions, and higher yields on Treasuries.
  • Large cap value outperformed large cap growth as mixed tech earnings caused shares of many mega cap tech companies to drop. Large cap outperformed small cap. Small cap companies have been punished in the high-interest rate environment due to their more volatile balance sheets and additional financing needs than their larger cap peers. 

International and Global Equities 

  • Foreign stocks fell behind US stocks in October, driven by economic slowdown in Europe, which was burdened by high interest rates and the lingering impact of Russia's war in Ukraine.
  • Emerging Market equity returns outperformed developed markets despite a -4.3% decline in China and a rising US dollar.

Fixed Income Markets 

  • Bonds posted negative results across the board as 10-year Treasury yields reached 4.9% for the first time since 2007. 

Specialty Markets

  • REITs continue to struggle as the high-interest rate environment is causing financing costs to rise. Commodities were able to eke out a positive return as demand for gold continued to grow.

US Equity Sectors

  • Sector performance in October was mainly negative, except for utilities, which were able to generate a moderate return. The energy sector took a beating in October due to geopolitical tension from the Israel-Hamas war and disappointing quarterly results from Chevron and Exxon Mobil.

November 1st, 2023

Dear Valued Investor,

The penultimate month of the year is often a time to reflect and offer thanks. And while economic and geopolitical uncertainty can overshadow the positives, there are things to be thankful for. Here is just some of what we’re thankful for, now that we’re in the second to last month of the year.

Resilient U.S. economy. Coming into 2023, the dreaded R word (recession) seemed a near certainty. But the most recent data showed our economy grew at a strong 4.9% clip (annualized) during the third quarter, the fastest rate since the initial COVID-19 recovery. Even though borrowing costs are rising, the consumer remains in good shape, bolstered by a strong job market and rising wages. While the economy is likely to slow in coming quarters, it’s unlikely to slow enough to concern stock markets, given the health of consumers and corporate America.

End of the earnings recession. Solid third-quarter earnings (vs. expectations) mean the earnings recession is almost certainly over. The market’s reaction to results has been mixed at best amid all the uncertainty. But a 5% year over year increase in S&P 500 earnings is a distinct possibility—perhaps 10% excluding the energy sector.

Easing inflation pressures. Surging inflation and the Federal Reserve’s (Fed) aggressive response were the big stories of 2022. But it seems inflation has eased enough to keep the Fed on hold at its next few meetings, and potentially cut rates in 2024. Historically, stock and bond markets have tended to perform well after rate hiking campaigns.

Fixed income is an attractive asset class again, despite recent bond bumpiness. After nearly a decade of very modest returns, yields for many fixed income investments are the highest they’ve been since 2007. Starting yields are the best predictors of future long-term returns, so at these higher yield levels, fixed income returns may be higher too. Moreover, yields for some of the highest quality fixed income sectors are offering attractive income again—which practically eliminates the need to invest in low quality bonds to generate income.

There’s no doubt this year has been challenging, given increased economic and geopolitical uncertainty. But taking a balanced view on the economy and the markets, we believe there are some positives that may help stocks finish the year higher. Even in the face of potential volatility, focusing on longer-term goals while tuning out short-term noise remains highly recommended.

Thank you for your trust along your financial journey.

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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.

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