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Quarter-End Insights

Our Take on the Third Quarter

Stocks continued to climb over the summer as worries over higher rates, emerging-markets, and commodities mostly faded.

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U.S. stocks continued their march higher in the third quarter. The broad-based Morningstar US Market Index was up 4.3% in the period. That index is now up 8.1% so far this year and up an annualized 16% over the past five years.

Investors were still trying to make sense of the Brexit vote as the quarter began, but that quickly fell into the background as the market was generally docile for most of the summer. The quiet was driven by a few factors. First, U.S. economic data that was strong enough to not worry about a recession, but no so strong that the Fed would be forced to raise rates. Secondly, fears around China and other emerging-markets that had been center stage earlier in the year eased. And finally, even though oil prices did bounce around they remained much higher than the levels seen at the start of the year.

Jeremy Glaser does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.