Stock Market Commentary -

The markets endured much drama in the two weeks leading up to quarter - end as the surprise exit of the U.K. from the European Union rattled investors. Brexit knocked over 5% off of the S&P 500 in two days, yet despite the unknown impact of this move on other world economies, investors regained confidence on the likelihood that central bankers would provide the needed support to maintain financial stability, and the S&P 500 finished the quarter with a respectable gain of 2.5%. Sector performance was mixed during the quarter, with Energy rebounding 11.6% on rising oil prices. Defensive sectors including Telecom, Utilities and Healthcare each jumped by 6 to 7%. Technology lost ground, sliding 2.8%. Mid -sized and small company stocks delivered solid returns, rising 4% and 3.8%, respectively.

Brexit and a further weakening of the Nikkei Index, led to declines in developed international markets. The MSCI Developed Index lost 3.3% for the quarter. Emerging Markets had a quarterly return of nearly 1% and has risen 6.6% year-to-date, supported by a strengthening of commodities and evidence of some stabilization in China’s economy. U.S. real estate assets continued their run, gaining 5.4% in the second quarter, as measured by the DJ Wilshire REIT Index. This sector has drawn investors seeking yield in the low rate environment. Real Estate will be designated as its own sector in the S &P 500 later this year.