SECURITIES MARKET RETURNS UPDATE
Through November of 2004

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Market Comment:

All of the major equity asset classes showed significant gains in November, with the S&P 500 gaining more than 4%, and the Russell 2000 small-cap index turning in a 8.7% return. The value indexes continued their general trend of outperforming their growth counterparts. In the fixed-income arena, investment-grade bonds lost money due to worries about the dollar and to the big run-up in equities. The falling dollar led to solid gains for foreign bonds. Natural resource and energy stocks rose 6%. Utility stocks gained 5 % during November.

 Current Asset Class Observations:

  • US Equities - Large growth stocks gained 3.1%. Value stocks gained almost 5%. Small cap and mid cap stocks gained over 7%. Stocks of publicly traded real estate companies (REITs) gained 5%. Financial stocks gained 4% while health care stocks gained 3%. Technology shares gained 6%. Commodities lost 1% as oil and natural gas prices declined from their highs.

  • Foreign Equities - European stocks gained 6%. Pacific Rim stocks gained 8% and Japanese stocks gained 4%. Latin American stocks gained 9% and other emerging market stocks gained 9% as a weaker dollar and strong exports to China and India benefit their economies.

  • Bonds - US bonds lost about 1% but global bonds rose almost 3% as the dollar lost significant value versus the euro. High yield bonds gained 1% as confidence rose that corporate defaults would decline. Inflation indexed bonds had a very small gain.

 

 

Best Worst
November 2004
One
Month
Three
Months
Twelve
Months
Emerging
Markets
9.21%
Emerging
Markets
17.78%
Natural
Resources
45.72%
Small
Stocks
8.67%
Natural
Resources
17.65%
REIT
Funds
29.33%
Natural
Resources
6.90%
Small
Stocks
16.01%
Emerging
Markets
25.31%
Foreign
Stocks
6.83%
NASDAQ
Composite
14.07%
Foreign
Stocks
24.19%
NASDAQ
Composite
6.17%
Foreign
Stocks
13.36%
Large
Value Stocks
18.98%
Large
Value Stocks
4.88%
REIT
Funds
10.09%
Small
Stocks
17.26%
REIT
Funds
4.66%
Large
Value Stocks
8.49%
S&P
500
12.85%
S&P
500
4.06%
S&P
500
6.78%
NASDAQ
Composite
6.97%
Large
Growth Stocks
3.16%
Large
Growth Stocks
5.01%
Large
Growth Stocks
6.88%
Bonds

-0.91%
Bonds

-0.08%
Bonds

3.23%
 
Consumer
Price Index
+0.20%
Consumer
Price Index
+1.00%
Consumer
Price Index
+3.24%
Key
Bonds - represented by Lehman Brothers Intermediate Index
S&P 500 - top 500 US stocks by market capitalization
NASDAQ Composite - all stocks traded on the NASDAQ Exchange
Large growth stocks - represented by the Barra Growth Stock Index
Large value stocks - represented by the Barra Value Stock Index
Small stocks - represented by the Russell 2000 Small Cap Index
Foreign stocks - represented by the MSCI International Stock Index
Emerging Markets - represented by the MSCI Emerging Markets Index
REIT Funds - composite of all Real Estate mutual funds
Natural Resources Funds - composite of all mutual funds
The opinions expressed in this commentary are those of Pinnacle Financial Advisors, LLC. These views are subject to change at any time based on market and other conditions, and no forecast is guaranteed. This material is derived from sources believed to be reliable, but its accuracy and the opinions based theron are not guaranteed. The opinions are for general information only and are not intended to serve as specific financial, legal, investment or tax advice.

Pinnacle Financial Advisors, L.L.C.
11000 Lincoln Drive West, Suite 8
Marlton, NJ 08053
856-797-8082

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UPDATED 12/20/2004
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