Summit Newsletter – April 2023

Summit Leadership

Summit is proud to announce that two of our key leaders were invited to speak at recent prestigious industry events.

Summit CEO Samantha Macchia spoke at the NAPFA National Large Firm Forum about “Developing the Next Generation Leader.” The National Association of Personal Financial Advisors is the standard bearer for fee-only, fiduciary financial advisors who commit to a client-centered business structure and high professional and ethical standards.

Summit Partner Wendy Trout took part in a panel for The Ohio State University’s Women’s Executive Summit, which connects students with female leaders in the finance industry.

We’re grateful they could share their experience and wisdom and learn from other bright financial minds.





Smart Tip



A Team Update

Congratulations to Steve Cavalieri, Andrew Herman, and Sam LaVielle on passing the CFP® exam. These three have tremendous drive and talent. We’re thankful they’ve chosen Summit as their home, and we’re excited tot see what they tackle next.



Investment Commentary

The Family Circus, the long-running syndicated comic strip still appearing in over 1,500 newspapers since its debut in 1960, has often featured the zig-zagged dotted line adventures of sons Billy and Jeffy roaming their neighborhood, or dreaming of other great adventures.  After complicated pathways with many diversions, Billy and Jeffy wind up at home where they started.

Bil Keane, the originator of The Family Circus, appears to have charted the recent course of the stock and bond markets to follow the dotted line journeys of his beloved characters.  The market’s Q1 performance has followed a winding path through interest rate hikes, mixed economic data, a surprisingly strong job market (in spite of tech company layoffs), China re-opening, ongoing war in Ukraine, a crisis of confidence in the banking system resulting in a major bank failure, and numerous other data points.

All of these issues have led to markets which are highly volatile compared to historical norms.  No wonder many investors have a sense of being sidetracked by all sorts of distractions thus far in 2023 – and it is no wonder that the ups and downs have left many investors feeling dizzy and exhausted.

The lead story of the first quarter of 2023 – much like most of 2022 – is the Fed and rate hikes. Still working to get inflation under control, the Fed has driven forward, onwards and upwards with the target rate for the federal funds rate. The equity and fixed income markets seemed to rejoice the absence of a January Fed meeting, and without the threat of any pesky rate hikes happening in January, risk assets rallied for the full month. As markets tend to trend, strength beget strength, and the confidence in the market seemed to inspire more confidence.

Big tech reversed course from 2022 and led the way. The largest component of the S&P 500, Apple, was up over 11% in January, and the tech-focused Nasdaq was up over 10%.




It was the best January for the Nasdaq since 2001. EAFE (an index comprised of Europe, Australasia, and the Far East) had the third best January on record. While stocks rallied, bonds also received a boost as intermediate-term interest rates fell, and the 10-Year Treasury dropped to 3.33 on February 2. Bullish economic news and investment commentary were becoming the norm.



The February jobs report released on the 3rd of the month revealed an addition of 311,000 jobs, which more than was expected – and viewed as a wrench in the Fed’s efforts fight against inflation. This brought about the hawkish (restrictive) chatter from Fed representatives. Fed Governor Bostic stated the jobs data raises the possibility of higher peak rates. Fed Chair Powell echoed the sentiment by stating if strong labor data persists, the peak rate may be higher. As investors have learned to not fight the Fed, neither stock nor bond investors liked that sort of talk, especially with a Fed meeting scheduled for February 22nd. The 10-Year Treasury took a straight line to 4% over the next 4 weeks, while the S&P 500 pulled back 5.5%.  The Fed hiked 25 basis points (bps) in the February meeting, which on its own did not elicit any dramatic market responses.

March started off with aforementioned Fed Governor Bostic making headlines again. Bostic surprised markets by stating the Fed could potentially pause rate hikes in the summer. Stocks and bonds both rallied on this news…but that exuberance was short lived due to the events related to Silicon Valley Bank on March 10th. (Read Summit special commentary on Silicon Valley Bank)  Stocks dropped and bonds continued to rally as rate hike expectations fell dramatically. The 2-Year Note traded from 5.08% to 3.72% over the next five days. The moves in short rates were being compared to Black Monday, the dramatic stock market crash on Monday, October 19th, 1987.



The March 22nd Fed meeting was originally looking to be a 50 bp hike. Banking events led to a 25 bp hike instead, with softened language in the Fed’s FOMC statement, and hawkish comments coming from Powell in the press conference that followed. Powell commented Fed officials “just don’t” see rate cuts this year and officials are willing to raise rates higher than expected if necessary. The markets have been relatively calm since the March Fed day treating the combination of messages as mostly neutral.

Phew… just like how Billy and Jeffy from The Family Circus always end up back where they started, despite all the meandering and detours, the market has somehow managed to remain largely unchanged, with most portfolios realizing small gains year to date. Clients who review their investments quarterly instead of following the day-by-day journey may have a less exhausted feeling about the same year-to-date performance. Know that your Summit team is here living the day-by-day journey of your accounts so you don’t need to – taking action, course correcting, and communicating.

On another note…
You may notice in your next meeting there is some new information on your Investment Policy Statement. We updated the historical returns through the end of 2022. Also, we now include the date ranges that produced the best and worst performance periods.

As always, your Summit team is available to answer any of your questions.



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