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Monthly Market Monitor - April 2011

Market Indices1AprilYear-to-Date
S&P 500+2.96%+9.06%
MSCI EAFE+6.08%+9.74%
MSCI Emerging Markets+3.12%+5.29%
Barclays U.S. Aggregate Bond+1.27%+1.70%
Barclays Municipal+1.79%+2.31%
Barclays US Corporate High Yield+1.55%+5.49%

The global equity bull market continued full steam ahead in April as equity markets once again posted solid monthly gains. Global equity markets were driven higher in large part by heightened merger activity, higher-than-anticipated 1Q earnings data on balance, and confirmation that many developed country central banks will likely maintain their accommodative monetary policies over the near term. U.S. equity markets did slump briefly towards the middle of the month following Standard & Poor’s inauspicious sovereign rating downgrade on the United States to negative from stable, but despite the S&P warning markets finished the month with healthy gains.

Bolstered by rising investor confidence, the S&P 500 Index posted another strong monthly gain of +2.96% in April. Investors were also encouraged by Fed Chairman Ben Bernanke’s overall “dovish” tone, essentially pledging to keep current low interest rates unchanged for an extended period lasting through at least two more FOMC meetings (into the fall). Nine out of ten US equity sectors rose in April, led by Healthcare, Consumer Staples and Consumer Discretionary, while Energy surprisingly came up the only laggard for the month.

Equity markets overseas managed to outpace the strong returns witnessed in the U.S. for the month of April. Non-U.S. developed equities, as measured by the MSCI EAFE Index, posted a very strong +6.08% return, led by the recovering Asian markets following the devastating Japan earthquake and tsunami in March. The MSCI Emerging Market index also edged out the U.S, returning +3.12% in April.

Core investment-grade U.S bonds, as measured by the Barclays U.S. Aggregate Bond Index, returned to favor last month, posting +1.27% gain in April as compared to March’s more benign +0.06% increase. Municipal bonds also posted strong performance for the month, returning +1.79% as measured by Barclays Municipal Index. The Barclays U.S. Corporate High Yield Index Bond posted a +1.55% gain last month as investors’ increased confidence from strong corporate earnings boosted the relative attractiveness of non-investment grade corporate debt.

  1. Morningstar Direct

Prepared by:Alex Kaye, CFA, Head of Research and Richard Anderson, Equity Research Director, Research Department, Cetera Financial Group

The views are those of Alex Kaye, CFA, Head of Research, and Richard Anderson, Equity Research Director, Research Department, Cetera Financial Group, and should not be construed as investment advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.

All economic and performance information is historical and not indicative of future results. The market indices discussed are unmanaged. Investors cannot directly invest in unmanaged indices. Please consult your financial advisor for more information.

Additional risks are associated with international investing, such as currency fluctuations, political and economic instability, and differences in accounting standards.

Securities and insurance products are offered by PRIMEVEST Financial Services, Inc., a registered broker/dealer. Member FINRA/SIPC. PRIMEVEST Financial Services is unaffiliated with the financial institution where investment services are offered. Investment products are * Not FDIC/NCUSIF insured *May lose value *Not bank guaranteed *Not a deposit * Not insured by any federal government agency.