Market Commentary
Financial markets struggled in December, as losses in crude sent shockwaves through the market. WTI crude oil declined by 19% during the month and closed the year at $53/bbl. Domestic large caps were mixed during the month, with sharp gains in utilities offset by losses in most other major sectors. International equities fared worse, with both developed and
emerging markets losing over 3% for the month and realizing losses for the calendar year in dollar‐terms. In fixed income, high‐quality bonds outperformed high yield, as losses surmounted in energy company bonds, while the 10yr Treasury yield ended the year 23% below where it started.
Market News
  • The average price for a gallon of gasoline in the U.S. has fallen for a record 97
consecutive days to $2.26/gallon; in 2014, Americans saved an estimated $14 billion at the pump compared to 2013 (American Automobile Association)
  • The number of active oil and gas rigs in the U.S. fell sharply during December, ending the month with 1,840 rigs active; the loss of 80 active rigs represents the largest decline in active rig activity since April 2009 (Baker Hughes)
  • Employment: A gain of 321,000 non‐farm jobs in November far exceeded the survey estimate of 230,000, increasing the likelihood that 2014 will produce the most net new jobs since 1999
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Notes: 1) Sources: Bloomberg, J.P. Morgan Asset Management, Morningstar, Hedge Fund Research, Bureau of Labor Statistics, Bureau of Economic Analysis. 2) Data as of the date of this report unless otherwise noted. 3) U.S. GDP measures the percentage change during the referenced quarter as published by BEA. 4) Consumer Price Index for All Urban Consumers: U.S. City Average, All Items Less Food and Energy is based on 12-month percent change as published by BLS.

Disclosures: This material is provided for informational purposes only and does not constitute an offer or solicitation by HFS, or its subsidiaries or affiliates, to invest in these indices or their constituent products. The data contained herein are from referenced sources which HFS believes to be reliable. This information discusses general market activity, industry or sector trends, or other broad-based economic, market or political conditions and should not be construed as research or investment advice. The views expressed are those of HFS. They are subject to change at any time. These views do not necessarily reflect the opinions of any other firm. Investing involves a high degree of risk, and all investors should carefully consider their investment objectives and the suitability of any investment. Past performance is not necessarily indicative of future results. All data is as of the date of this report unless otherwise noted.


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