While large cap and international stocks continued to move higher, the markets are starting to see more dispersion with small cap, growth, and value indices all posting negative returns for the month. The Russell value index has fallen to negative returns for the year. A growing dispersion is also evident in sector and country returns. Bonds have been a safe asset with positive gains for the year across all sectors. The returns are consistent with slow but positive growth around the world with controlled inflation.













With oil prices moving lower, the energy sector had a strong May decline and is negative on the year. The finance sector also declined in May while technology has moved to well above 15% for the year. Investors are being rewarded for making sector bets.












Country equity indices mostly reported strong gains for the month and generally have done much better than the US, albeit over 5 percent of the move may be associated with currency moves. Commodity-driven countries showed poorer performance this year.










While the gains have not be strong for the month or the year, bond sectors are all positive for the year. The only negative sector for the month was TIPS given the decline in inflation and forward expectations. Our trend and breakout indicators are all showing that bonds are a buy for any portfolio.