Global financial markets posted mixed results in November, with the sell-off in crude oil causing further pain to the energy sector. Despite the energy sector’s 9% loss, U.S. equities generated positive performance, led by gains in consumer and technology stocks. Developed market equities outperformed emerging, with the diversified economies of the U.S. and core Europe outperforming more industrial, commodity-laden regions like Russia and Brazil. Hedge funds posted modest gains, with trend-following strategies delivering their best monthly return in over five years while hedged equity managers were confounded by weakness in energy and small caps.
- OPEC's decision to not cut crude production caused oil prices to plummet, with WTI closing 30% below its high in June; low crude prices are stimulative for the economy as energy prices make up a larger share of lower-income household budgets
- The Q3 GDP "second" estimate was revised upward to 3.9% from 3.5%, with much of the increase coming from companies restocking inventories ahead of the 2014 holiday season
- Corporations had another profitable quarter, with Q3 earnings increasing nearly 10% and revenues 4% from Q3 2013; energy and healthcare companies registered some of the biggest profits during the period (Goldman Sachs)
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