Sage Advice Quarterly Market Review 1Q2005

The financial markets are starting the new year right where they left off in 2004. The one exception is the behavior of the equity market, which kicked off 2005 with three consecutive weekly declines, something that hasn’t happened since 1977. Otherwise, bond yields continue to drift lower, credit spreads remain exceptionally tight and the short-end of the curve is still responding to Fed-induced upward pressure. Except for the short-term rate movement, we expect that the rest of the financial markets will reverse course as the year progresses.